Home Inequity
Early on in my practice, I did a lot of residential real estate. I helped clients complete offers to purchase, and it was common for the interest rate on their loan to be in the double digits. Then, during the Great Recession, interest rates plummeted and a lot of the clients I helped rushed in to refinance their loans.
Because homes are typically a family’s largest single asset, and especially with home values being at an all-time high, any savings on a mortgage can be helpful. Unfortunately, scam artists know this, too.
The Federal Communications Commission recently issued a consumer alert to consumers in all 50 states that sophisticated swindlers are posing as mortgage lenders to defraud people. Based on the sheer volume of consumer complaints, the agency estimate Americans have already lost hundreds of thousands of dollars.
Dubbed “Green Mirage,” the scam involves callers contacting homeowners who oftentimes “have previously sought relief from their actual mortgage lender and may expect to be contacted,” the FCC’s alert read. The callers typically know specific details such as the homeowner’s name, address and current or former mortgage lender. They are even able to spoof the caller ID so as to appear as legitimate employees of the homeowner’s actual lending institution. The FCC estimates that Green Mirage has impersonated over 400 mortgage lenders.
“The callers persuade the homeowner that they need to pay in a manner different than their usual mortgage payment method,” the alert reads. “Most commonly, the callers demand payment by asking consumers to mail money orders to third-party ‘attorneys’ and representatives or to upload funds to Walmart Green Dot Money Card accounts.” The callers then threaten foreclosure if the consumer doesn’t follow their instructions. Unfortunately, many victims only learn of the scam when their actual lender starts foreclosure proceedings.
According to Peter Hyun, the FCC’s acting enforcement bureau chief, the operatives use “sophisticated social engineering techniques to take advantage of vulnerable homeowners experiencing financial hardship.” Chairwoman Jessica Rosenworcel added, “Today’s actions both warn consumers of this latest set of scams, and put on notice all other voice service providers to immediately stop carrying these junk calls.”
The FCC fears these scam calls will increase exponentially because of the L.A. wildfires. Due to so many homes being damaged, homeowners will expect to be in contact with their lender, putting them at risk for mortgage scams.
Insurance scams are known to multiply after natural disasters, such as the wildfires, hurricanes or tornadoes. “If you get a phone call about an insurance claim or policy, don’t give out any personal information or agree to any payment until you can independently verify that the call is legitimate,” the FCC advises. “If the caller says they’re from your insurance company, hang up and contact your agent or the company directly using the number on your account statement.”
The FCC further warns about “federal officials” asking for money or calls/texts asking for financial account information. The agency again recommends hanging up on anyone claiming to be a government official and instead call the number listed on that government agency’s official website.
FCC officials warn that you are likely talking to a scam artist if:
• You are pressured to provide money or information
• You are asked for payments through unusual methods or channels
• You are offered a deal that sounds too good to be true
Hopefully the Justice Department can find some of these scammers and send them to the big house.
Reg P. Wydeven
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