All across the country, reports of foreclosure rates on the rise are finding their way into local television reports, periodicals, and newspapers. Lately, homeowners who are in danger of banks and lending institutes foreclosing on their property, are being afforded the opportunity to short sell their homes for less than what they owe on their mortgages. According to a NY Times article, current government funded incentives have nearly quadrupled the number of short sales made across the country, in comparison to figures from 2008.
Reportedly however, fraudulent activity regarding short sale practice is becoming more prevalent. In some cases, lenders sell homes to “straw buyers,” or those individuals who are actually affiliated with the lender, for less money. Thereafter, the lender turns around and sells the home for a higher, more market-friendly price. This is done unbeknownst to the original homeowner who authorized the short sale, in the first place.
In other cases, homeowners may purposefully default on their home loans and short sell their house to a friend, who would pay less than the amount due on the loan. Thereafter, the homeowner would continue to live in the house and pay the monthly mortgage payment, which is less than the previous monthly payment. At that point, the homeowner’s friend, who purchased the home, may transfer ownership to the original homeowner via the quitclaim deed process. Nationwide, the state of New Jersey ranks eighth in terms of the number of fraudulent short sales, with 3.3.% of all those sales being deemed suspicious. Furthermore, the article warns against real estate agents who claim to be foreclosure specialists.
If you are thinking of short selling your home, or selling real estate in New Jersey, your best defense against fraudulent activity involves retaining the services of an experienced bankruptcy protection lawyer. At the Law Offices of Robert Manchel, our skilled New Jersey foreclosure resolution attorneys will see to it that you are not taken advantage of during an already difficult time. For more information about your rights and options, please call 866-503-5655 today.