WASHINGTON, DC--(Marketwire - April 6, 2009) - NeighborWorks® America announced its
support and applauds the much-needed crackdown on foreclosure rescue scam
artists that was announced today by the Federal Trade Commission (FTC),
U.S. Attorney General's Office, Treasury Department, and Department of
Housing and Urban Development. NeighborWorks® America also announced that
it is working with the FTC to develop a national public education campaign
to make borrowers aware of how to avoid foreclosure prevention scam
artists. Homeowners in danger of foreclosure should never pay for help, and
should instead seek assistance from HUD-approved nonprofit housing
counseling agencies, including those found at
www.findaforeclosurecounselor.org and
www.makinghomeaffordable.gov.
"Rescue scams are proliferating at a rapid pace and more homeowners are
falling prey to the slick advertising and sales pitches that guarantee to
keep them in their homes," said Ken Wade, CEO of NeighborWorks America.
"The coordinated effort announced today aims to stop predatory and
fraudulent 'rescue' practices not only through enforcement but also by
educating vulnerable homeowners so they can avoid these scams in the first
place."
NeighborWorks America has been working with the FTC and the federal and
state agencies involved in today's announcement since early this year to
develop a comprehensive approach that draws on the resources and
enforcement powers of the various regulatory agencies to stem the tide of
rescue scams. In addition, NeighborWorks America was recently appropriated
$6 million to develop a public education campaign that will include
advertising, direct borrower outreach and information. The NeighborWorks
America outreach effort will be coordinated with efforts by the FTC.
NeighborWorks America first began to hear about the proliferation of
foreclosure rescue scam artists in 2008 from its network of local nonprofit
NeighborWorks organizations. Foreclosure rescue scam artists frequently
demand upfront payment for their services and "guarantee" to modify,
refinance, or reinstate a borrower's mortgage. The payment demanded can be
anywhere from $1,000-$5,000, as was the case for one homeowner in Texas.
NeighborWorks Waco, located in Waco, Texas, recently worked with a
homeowner who was bilked out of $2,000 by a company that promised to work
with the borrower's lender to reinstate the homeowner's mortgage. In
reality, the company did nothing, leaving the borrower with the same
problem and without the borrower's $2,000.
Since January, NeighborWorks America has filed several trademark complaints
with online search engines to protect consumers from falling prey to
foreclosure rescue scams. The trademark complaints filed by NeighborWorks
sought to remove online ads paid for by so-called mortgage rescue companies
that used the NeighborWorks name and logo and offered foreclosure help for
a fee. The companies have no affiliation with NeighborWorks.
"If you are facing foreclosure, do not pay any person or company up front
for services," said Wade. "Homeowners facing foreclosure need to be aware
that foreclosure rescue scam artists are out in full force and see this as
a prime opportunity to make money. When it comes to foreclosure
assistance, the old adage 'you get what you pay for' does not apply. If
you are facing foreclosure, contact a HUD-approved nonprofit housing
counseling agency to receive foreclosure counseling. Nonprofit
organizations are a homeowner's best defense against foreclosure."
NeighborWorks America urges homeowners not to pay a person or company for
foreclosure help, and offers borrowers the following tips to avoid
foreclosure rescue scams:
-- If you are facing foreclosure, do not pay for help.
-- Suspect any ad, person, or company that approaches you through direct
mail, email, in person, or over the phone, and claims to be able to "stop
foreclosure now" for a fee. Never give your financial information to a
person or company you know nothing about.
-- When you need help with a possible foreclosure on your home, don't
hesitate to contact your local NeighborWorks organization or other HUD-
approved nonprofit housing counseling agency for free foreclosure
counseling. To find a local NeighborWorks organization or other HUD-
approved nonprofit housing counseling agency near you, visit
www.findaforeclosurecounselor.org.
-- If you feel more comfortable speaking to a counselor over the phone,
call the Homeowner's HOPE Hotline at 888-995-HOPE for free foreclosure
prevention counseling by expert counselors at HUD-approved nonprofit
counseling agencies. The hotline is open 24 hours a day, seven days a week,
and is available in Spanish and in English.
-- Contact your mortgage lender. Contrary to what a foreclosure scammer
will tell you, you should contact your lender the minute you have trouble
making your monthly payment.
For more information, please contact Doug Robinson, 202-220-2360,
drobinson@nw.org, or Erin Angell Collins, 202-220-6317,
ecollins@nw.org.
About NeighborWorks America
NeighborWorks America creates opportunities for people to improve their
lives and strengthen their communities by providing access to homeownership
and to safe and affordable rental housing. Since 1991, we have assisted
nearly 1.2 million low- to moderate-income families with their housing
needs. Much of our success is achieved through our support of the
NeighborWorks network -- more than 230 community development organizations
working in more than 4,400 urban, suburban and rural communities in all 50
states, the District of Columbia and Puerto Rico. In the last five years,
NeighborWorks organizations have generated more than $15 billion in
reinvestment in these communities. NeighborWorks America is the nation's
leading trainer of community development and affordable housing
professionals.
Contact Information: Contact:
Doug Robinson
202-220-2360
drobinson@nw.org
Erin Angell Collins
202-220-6317
ecollins@nw.org