Las vegas foreclosures rescue, also known as equity skimming or equity stripping, is any of various predatory real estate practices aimed at vulnerable, often low-income, homeowners facing foreclosure in the United States. Most often, these transactions take advantage of uninformed, low-income homeowners.
The term “foreclosure rescue” has sometimes referred to subprime lending refinance practices that charge excessive fees thereby “stripping the equity” out of the home. The practice more often describes foreclosure rescue scams. While most do not consider foreclosure rescue a form of predatory lending per se, foreclosure rescue is related to traditional forms of that practice.
Subprime loans targeted at vulnerable and unsophisticated homeowners often lead to las vegas nv foreclosures, and those victims more often fall to foreclosure rescue scams. Additionally, some do consider foreclosure rescue, in essence, a form of predatory lending since the scam works essentially like a high-cost and risky refinancing. Foreclosures in las vegas rescue, however, is conducted almost always by local agents and investors, while traditional predatory lending is carried out by large banks or national companies.
Trends in the United States economy have led to the growing market for foreclosure services and foreclosure rescue. Property values have increased dramatically from 2000-2005.
Foreclosure A homeowner falls behind on his mortgage payments and enters foreclosure. Foreclosure notices are published in newspapers or distributed by reporting services to investors and rescue artists. Foreclosed homeowners also contact lenders to inquire about refinancing options.
Solicitation Rescue artists obtain contact information for foreclosured homeowners and make contacts personally, by phone, or through direct mail. Some lenders and brokers will also refer foreclosed homeowners that do not qualify for new loans to rescue artists for a commission. Rescue Artists offer the foreclosed homeowner a “miracle refinancing” and/or say they can “save the home” from foreclosure.
Acquisition Rescue artists arrange the closing (often delaying the date until shortly before the homeowner’s removal in order to create urgency). At the closing, the homeowner transfers title (possibly unwittingly) to the rescue artist or an arranged investor. The rescue artist or arranged investor pays off the amount owed in foreclosure to acquire the deed, and inherits or is paid any portion of the homeowner’s remaining equity.