July 29, 2005
Minnesota law targets foreclosure scams
A recent article posted on MPR’s web site talked about a new Minnesota law that tries to stop mortgage foreclosure scams. The article talked about the story of Teresa Amelsberg Crowe who was a victim of one of these scams before the new law was passed. Teresa was in an accident and had medical bills on top of private schooling bills for her children. With the mounting debt and no where to turn she opted for what she thought would be a good choice. She decided to refinance her house and use that money to pay off her bills. Teresa’s real troubles began when a con artist real estate agent suckered her into selling her house. The real estate-agent was able to convince Teresa that this was her only option because of her bad credit. The real estate agent bought the house and agreed to rent it back to Teresa but now Teresa cannot afford rent and is about to get evicted.
The new Minnesota law requires that the homeowner be able to pay off the transaction and it limits the amount of money that can be made in these deals. Even with the passing of this law there is a bill in the U.S. House that would repeal it. Many lending agencies feel that they can regulate themselves and ‘buyers should beware’.
I think it is unfortunate that people get hurt like Teresa did but you do have to have some common sense when it comes to things like this. I would have contacted a lawyer before signing anything not after I got screwed.
I agree with Chuck that people need to approach this kind of a deal with open eyes. However, there are those "lenders" who prey on people in desperate situations. Someone with bad credit, mounting medical bills and children to pay for may feel the need to act quickly and abandon their better judgement.
Posted by: Patti at July 29, 2005 10:07 PM