Home equity and mortgage relief scams: how they take your house
Quick answer
A company that charges you upfront to "save your home", asks you to sign over your deed or tells you to stop talking to your lender is a scam. The FTC says it's illegal to charge a penny before delivering a written offer from your lender that you accept.
- Comes by
- Phone call, Mail, Email, Website, Ad
- Last updated
How it works
The FTC says scammers target homeowners who are struggling to avoid foreclosure. They promise to change your loan so you can stay in your home, but they want a fee first.
Common versions:
- Phony counseling: they say they're housing counselors, lawyers or the government, tell you not to contact your lender, and may ask you to send mortgage payments to them. They keep the money and your loan goes into default.
- Forensic audits: "auditors" promise a review of your loan papers will lower or cancel what you owe. They can't promise that.
- Rent-to-buy ripoffs: you sign over the deed and rent the home, with a promised chance to buy it back. Transferring the deed doesn't transfer the mortgage, so you still owe it.
- Equity skimming: they ask you to sell your home to them for far less than it's worth, promising to give it back or share the profit. They rent it out and keep the money while foreclosure goes ahead.
They often want payment by cashier's check, wire transfer or a payment app, because it's hard to get back.
Red flags
- A fee demanded before you get any help
- A request to transfer the deed or sell your home to them
- Being told not to contact your lender, lawyer or housing counselor
- Instructions to pay your mortgage to them instead of your lender
- Payment only by cashier's check, wire or payment app
- Promises to guarantee a loan modification or cancel your loan
Example message
We can stop your foreclosure and cut your payment. Our fee is due today, and for this to work don't contact your lender. Sign the attached deed so we can take over the process. Call [phone number].
What to do
- 1
Don't pay upfront and don't sign over your deed
The FTC's Mortgage Assistance Relief Services (MARS) Rule says a company can't charge you until it has given you a written offer from your lender that you accept.
- 2
Talk to your lender directly
You always have the right to contact your lender about other options. A company that tells you to stop is breaking the law.
- 3
Check any lawyer or counselor yourself
If someone says they're a lawyer, confirm they're licensed in your state. The FTC page lists where to find legitimate help.
- 4
If you paid or signed something, act fast
Contact your lender, then file reports. The FTC page has specific steps if you paid a scammer. Keep every document, receipt and message.
- 5
Protect your identity
If you shared your Social Security number or bank details, see IdentityTheft.gov and our guide on what to do after a data breach.
Report it
Check if your details are exposed with Serus
Scammers find your number and address on data brokers and people-search sites. Serus removes them.
Why you got it
Foreclosure notices and property records are public, and data brokers and people-search sites combine them with your phone number and email. That's how a stranger can call or mail you about your mortgage with your name and address already in hand.
Serus finds where your address and phone number are listed and removes them where it can, so fewer scammers can reach you.
Frequently asked
Can a company legally charge me upfront for mortgage help?
No. The FTC says the MARS Rule makes it illegal to charge until you have a written offer from your lender and accept it.
What does the FTC say about transferring my deed?
The FTC warns that if you transfer the deed you're unlikely to get it back, and the mortgage stays yours either way.
Is a forensic loan audit worth paying for?
The FTC says scammers can't promise an audit will get you any relief, and even winning a lawsuit doesn't force a lender to modify your loan.
Where can I get real help?
The FTC's mortgage relief page lists legitimate help. Your lender is a first call, and you can report a scammer to the FTC or your state attorney general.
Sources
Something wrong or out of date? Tell us and we'll re-check it.
