Consumer Column

How to Recognize Foreclosure Scams
“Stop Foreclosure Now!” . . . “We guarantee to stop your foreclosure.” . . .
“We Can Save Your Home. Guaranteed. Free Consultation.”

If you are facing foreclosure the above advertisements are likely to catch your eye. Before you are tempted to respond to these offers, you need to know that there are scam artists looking to take advantage of your situation.
The Louisiana Attorney General’s Office and the Federal Trade Commission (FTC) want you to know how to recognize a foreclosure rescue scam. The following are some common tactics that are used by scam artists to “help” you:

• Phony Counseling or Phantom Help
The scam artist tells you that he can negotiate a deal with your lender to save your house if you pay a fee first. Once you pay the fee, the scam artist takes off with your money. In some cases the scam artist tells you to make all mortgage payments directly to him while he negotiates with your lender. Of course, your payments are never passed on to your lender and the scam artist takes off with your money.
• Bait-and-Switch
You’re told you’re signing documents for a new loan to make your existing mortgage current. The reality is that you’ve signed documents that surrender the title of your house to the scam artist in exchange for a “rescue” loan.
• Bankruptcy Foreclosure
The scam artist may tell you he will negotiate with your lender or to get refinancing on your behalf if you pay a fee first. However, instead of contacting your lender or refinancing your loan, the scam artist pockets the fee and files a bankruptcy case in your name—sometimes without your knowledge.

If you’re having trouble paying your mortgage or you have received a foreclosure notice, contact your lender immediately. Also, under More Resources found on this page are links to two publications from the Federal Trade Commission that should be helpful to you if you are facing foreclosure.

If you are looking for foreclosure prevention assistance, remember to avoid any businesses that do the following:
• Guarantees to stop the foreclosure process no matter what your circumstances.
• Instructs you not to contact your lender, lawyer or credit or housing counselor.
• Collects a fee before providing you with any services.
• Encourages you to lease your home so you can buy it back over time.
• Tells you to make your mortgage payments directly to it rather than your lender.
• Tells you to transfer your property deed or title to it.
• Offers to fill out paperwork for you.
• Pressures you to sign paperwork you haven’t had a chance to read thoroughly or that you don’t understand.
If you believe you have been the victim of a foreclosure rescue scam, please contact the Louisiana Attorney General’s Consumer Protection Section at 800-351-4889 and the Federal Trade Commission at

Coming soon, the attorney's general office seeks to provide a mechanism by which to take online payments for collections.