Don't fall victim to foreclosure fraud

null After years of renting, the Mizer family bought a house in 2005. However, two years later, Kari and her husband Roger saw the rate on their adjustable mortgage shoot up far beyond what they could afford.

"The house payments doubled in six months to $1,847," said Kari.

They looked for refinancing from more than 40 lenders with no success. Then they got a letter from a mortgage restructuring firm that claimed to have a "95.5 percent resolution success" rate in stopping /*foreclosures*/.

"I remember us hugging -- 'Baby, we're going to get to keep the house.' Telling the kids we're going to be able to keep the house," said Kari.

The company charged more than $1,300 up front and said it would handle everything. But the Mizers say that was the last they heard. A month later, their bank started foreclosure proceedings. The bank told them it had never been contacted by the company. /*Consumer Reports*/ says the Mizers were a victim of one of the most common financial traps that are flourishing these days.

"So-called foreclosure-rescue firms comb the public record for pending foreclosures and they prey on people who are desperate to hang on to their home," said Andrea Rock, Consumer Reports.

To avoid foreclosure traps, Consumer Reports says watch out for unsolicited offers; be wary of demands for upfront fees before service is provided, even if they offer to put you on a payment plan; and stay away from any service that advises you to stop contact with your lender or that asks you to transfer the title of your home.

Consumer Reports says if you're in mortgage trouble, you need legitimate help fast.

"Get in touch with a government-certified counseling agency that can help you negotiate with your lenders," said Rock.

As for the Mizers, they've found reason to be grateful.

"We instill with our kids -- regardless of the house, wherever we live -- as long as we're together, we're OK," said Roger Mizer.

To find a government-certified counseling agency, call the Department of Housing and Urban Development at (800) 569-4287. You may also call the Homeowner's HOPE Hotline at (888) 995-4673, which has counselors that work with callers at no charge to help them assess their options.


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