Mortgage Fraud Examiners, the investigative firm who warned the public about the “criminal loan modification trap” and “useless” software audits, now warns the public of this latest scam—“Mortgage Elimination”
Ashburn, VA, April 13, 2010 (PressReleasePoint) — Actually, this scam is not new; the last time it was prevalent was back in the late 1980s and early 1990s when many Midwestern farmers were losing their family farms. Hucksters flooded the Corn Belt promoting their openly brainless schemes managing to convince farmers that they weren’t required under the law to repay their bank loans. These same nonsensical theories have resurfaced today in what is known as “Mortgage Elimination.”
Mortgage Fraud Examiners CEO Storm Bradford explains: “The previous scams we’ve exposed dealt mainly with companies that market “useless” software audits, and companies charging fees for a loan modification when the homeowner can go to HUD or non-profit organizations and get one for free. This scheme literally instructs homeowners on how to commit federal and state crimes.”
“Swindlers of the “Re-conveyance By Administrative Process” scam, as it’s known, advise homeowners that financial institutions are forced to cancel mortgages and/or deeds of trust, without payment on secured promissory notes because allegedly they never lent money to the borrower for the purchase of their home. According to them, this makes most mortgages unenforceable against their so-called “proprietary administrative procedure.”
“Why would anyone believe such idiocy when obviously the bank writes a check for the purchase of a home, or writes the homeowner a check for a cash-out refinance? Because these swindlers literally change the content of legal definitions, statutes, and court cases; cite various discredited legal theories, quote from out-of-context Federal Reserve press releases, and intermingle bogus legal terminology, to scam thousands of dollars out of unsuspecting homeowners who are not aware of the fact this “vapor money” theory has been squarely addressed and rejected by courts throughout the country for over twenty-five years.
“Homeowners in foreclosure are simply desperate for a solution, and that’s what the scammers count on. The sad part is the desperate homeowner and his family end up in even more desperate straits. They end up paying thousands of dollars for legal babble that gets them nothing, except a possible criminal conviction in the end.”
There are several variations of the scam, but basically this is how it works:
In essence, the homeowner files a forged reconveyance on a property, making it appear that the property is owned free and clear. The homeowner encumbers the property with a new loan and runs off with the new loan proceeds.
“There really are many legal options available to homeowners facing foreclosure,” Bradford concludes. “However, the only process that works is to find a REAL legal dispute that a judge is willing to accept as a valid reason to declare the debt void, such as tortuous misconduct, gross violation of lending laws, violations of state and federal consumer protection acts, or appraisal fraud. Every mortgage transaction has unique facts, every claim has different applicable law, and only a legal specialist is going to find the answers.”
PO Box 1332
Ashburn, Virginia 20146
Mortgage Fraud Examiners
Phone: 800-540- EXAM (3926)