Consumer protection week scam of the day alert: foreclosure rescue


–Attorney General Koster cautions homeowners to beware of foreclosure scams–

Jefferson City, MO – March 8, 2010 – (RealEstateRama) — Attorney General Chris Koster said today the nation’s financial crisis has led to rampant growth of foreclosure-rescue scams. Since he took office in January 2009, the Attorney General’s Office has had 321 complaints of foreclosure fraud, compared with just 25 complaints in 2007 and 2008 combined, a more than one-thousand percent increase.

“There is no doubt that our nation’s tough economic times have given rise to scammers preying on those at risk of losing their homes,” Koster said. “In Missouri we will continue to have a zero tolerance stance against these scammers who try to take advantage of people who are in dire financial straits.”

Since he declared a “zero tolerance” campaign against these types of mortgage fraud in April 2009, Koster’s office has taken legal action against eight businesses involved in foreclosure rescue or mortgage modification scams, and is continuing to investigate others.

Today, Koster joined with Kansas Attorney General Steve Six, the Federal Trade Commission and local organizations to highlight a major campaign against foreclosure-rescue scams. Kansas City is one of a number of cities participating in the NeighborWorks America Campaign to help at-risk homeowners avoid and report loan-modification scams.

Koster alerts consumers that businesses marketing foreclosure relief often demand up-front fees from consumers. Koster said it is illegal in Missouri for these types of businesses to charge up-front fees before providing services, and consumers should never pay such a fee. He also said that these businesses also often tell consumers to stop making their mortgage payments to their lender, a practice which leads to long-term damage to the consumer’s credit rating and hundreds or thousands of dollars in additional fees and debt for the consumer.

Koster said foreclosure rescue firms use a variety of methods to find distressed homeowners, such as going through public foreclosure notices or public files at government offices. He urged consumers to be cautious of an individual or company representing itself as a “foreclosure rescuer,” “foreclosure service,” or “mortgage consultant.” He said consumers always should be wary of anyone guaranteeing to stop their foreclosure and should never sign any document they haven’t had time to read or do not fully understand.

“The old adage ‘if it sounds too good to be true, it probably is’ is an apt statement where foreclosure rescue scams are concerned,” Koster said. “If you are facing foreclosure or are having other difficulties with your mortgage payments, work through a non-profit, HUD-certified counselor or an experienced attorney. And if you are the victim of a foreclosure rescue scam, call our consumer protection hotline at 800-392-8222 or to go online at to file a complaint.”

Koster is issuing a “scam of the day alert” each day this week as part of National Consumer Protection Week.


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RealEstateRama staff editor manage to selection and verify the real estate news for State of Missouri.


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