What is Equity Skimming? The quick simple answer is that it is a scam to cheat homeowners who are having problems making their mortgage payments out of the equity in their property.
Here is how the scam works. The homeowner is contacted by the Scammer offering to payoff their mortgage, or to give the homeowner a sum of money when the Scammer sells off the property.
The Scammer will most likely ask the homeowner to move out of the house quickly, and deed the house to them so that they can sell the house for them. The Scammer then proceeds to rent the property while trying to sell it, but does not use the money to make the mortgage payments, which results in the Lender foreclosing on the homeowner if the property does not sell.
Deeding the property over to someone else does not eliminate the homeowners obligation to pay the mortgage. Deeding the property to the Scammer gives the Scammer ownership of the property without any of the finacial obligation. The financial obligation remains with the homeowner, as well as all the negative results of being foreclosed on.
The Scammer profits all of the rental income that they are able to acquire before the property is foreclosed, or all of the profit from the sale of the property if they are able to sell it. The homeowner loses any income produced by the property because they no longer have any ownership in the property. Also because they Deeded to property to the Scammer of their own free will, they do not have any legal action that they can take.
Scammers feed off of those who are in trouble, because that is when they are most vulnerable. Most homeowners who are in danger of losing their home will do almost anything to try to keep it, which makes them prime targets for Equity Skimming.
What Is Equity Skimming? It is stealing from the trusting and helpless. Be careful who you trust, and be careful what you agree to sign.
*******************************************************************************
Info about the author:
George Souto is a Loan Officer who can assist you with all your FHA, CHFA, and Conventional mortgage needs in Connecticut. George resides in Middlesex County which includes Middletown, Middlefield, Durham, Cromwell, Portland, Higganum, Haddam, East Haddam, Chester, Deep River, and Essex. George can be contacted at (860) 573-1308 or gsouto@mccuemortgage.com
Comments(36)