Industry News

Proposed state law protects against foreclosure scams

Colorado joins others seeking to regulate procedure

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A bill aiming to protect consumers from scammers who prey on homeowners facing foreclosure is making its way through the Colorado legislature as lawmakers nationwide seek to combat the problem. Two other states, Minnesota and Maryland, have recently enacted laws protecting consumers from such scams. Maryland's law went into effect last May, while Minnesota's was enacted a year and a half ago. New York and other states also have legislation pending, according to Elizabeth Renuart, staff attorney at the National Consumer Law Center. "There is definitely a trend," Renuart said. California, Georgia and Missouri already have such laws on the books, the attorney said. According to a report published by the National Consumer Law Center in June 2005, thousands of people across the country are losing their homes to foreclosure "rescue" scams. The report, which identified scams in 18 states including Colorado, recommended that states ban or regulate such activity. In a typical foreclosure scam,...