Freddie Mac is using YouTube drama to get the word out about foreclosure fraud.
Freddie Mac is one of the nation's largest investors in residential mortgages and it decided to air an Internet video about foreclosure fraud because a survey found the Internet is the first place one in four mortgage delinquent homeowners go for mortgage information.
That's almost as many troubled homeowners who go to their mortgage lender (28 percent) or bank (32 percent) first, according to the Freddie Mac-sponsored survey.
Unfortunately, Internet searches can send you right into the hands of con artists whose only desire is to steal your home equity.
Generally speaking, equity is the difference between the market value of a home and the amount the homeowner owes the lender.
Home values have fallen in many areas, but before the current soft market, the housing boom generated enough equity to see many borrowers through hard times.
Freddie Mac's two-minute, professionally-produced and acted "Avoid Fraud" video dramatizes a common foreclosure fraud scheme and demonstrates the game the scam artist plays to get at your equity.
According to the video:
- The con artist gets copies of public documents, including default and foreclosure notices filed at city and county offices.
- The scammer telephones to prey upon the homeowner's distressed and vulnerable state. He offers empty promises to convince the homeowner to give up deeds and other mortgage documents.
- The scammer uses the deeds to secure new loans, but pulls out the equity for himself and allows the homeowner's loan to go into foreclosure.
- The homeowner who was hoping for help, loses the home, equity and any cash necessary to finance the new loan.
Freddie Mac's "Avoid Fraud" YouTube video also comes with the message: "Shut the door on fraud." Report it to 1-800-4Fraud8 (1-800-437-2838).
