Foreclosure Scams

Foreclosure fraud encompasses any type of scheme involving misrepresentations, false statements, or false promises related to foreclosure

The possibility of losing your home to foreclosure can be terrifying. The reality that scam artists are preying on desperate homeowners is equally frightening. Many companies say they can get a change to your loan that will reduce your monthly mortgage payment or take other steps to save your home. Some claim that nearly all their customers get successful results and even offer a money-back guarantee. Others say they're affiliated with the government or your lender and still others promise the help of attorneys or real estate experts.

Unfortunately, many companies use half-truths and even outright lies to sell their services. They promise relief, but don't deliver. In fact, many of these companies leave their homeowner customers in worse financial shape.

In New York, foreclosure scams are quite common. Following are possible scenarios:

1. A person offers to negotiate with the homeowner’s lender on the behalf of the homeowner promising wonderful results.

2. An attorney brings baseless lawsuits in order to charge a consumer a fee.

3. A company convinces a homeowner to transfer their deed or mortgage to a third party.


To avoid foreclosure scams:

  • Legitimate organizations or people can only promise to work hard for you. You must be cautious of promises that involve your loan modification or any other outcome with your mortgage.​

  • Never send your mortgage payments to anyone other than your mortgage lender or servicer. Cautiousness is advised if you are asked to stop making mortgage payments or pay the assistance company.

  • If you do not understand paperwork, DO NOT SIGN IT. Make sure you fully understand everything you sign and be cautious if someone is pressuring you into signing something you’re unsure of. Always stick to your gut feeling or the “little voice inside.”

  • A trustworthy organization or company will never ask you to transfer property ownership to them. If you are asked to do that, walk away.

  • If a company or person aggressively calls you stating you will lose your home without their help, do not engage with the caller.


If you’re unsure that you can trust a business or individual in assisting  you with your mortgage or home, contact the NYS Attorney General’s Homeowner Protection Hotline: 1-855-HOME-456.

Source: NYS Attorney General Office