Industry News

Better Business Bureaus see upswing in real estate lending scams

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The Council of Better Business Bureaus has issued an alert to stem what it says is a growing number of incidents involving lenders who prey on heavily indebted homeowners. With rising interest rates driving an increase in foreclosures, unscrupulous lenders are combing through public records for victims, the council reports. "At-risk homeowners are bombarded with offers that arrive by mail, over the phone or are tacked to neighborhood telephone poles," said Steve Cole, the council's president and CEO, in a press release. "Smooth-talking salespeople appear, eager to buy their property and promising to 'save' their home by paying off the amount that is overdue on the loan.". Sometimes, homeowners are talked into moving out and deeding the property over to a third party. They are told they can rent their former home with the option to buy it back later, but often can't make rent and are evicted, Cole said. When homeowners try to buy back the property, the "scam operator" usuall...