Foreclosure: A Shark’s Tale

As anyone who has missed mortgage payments and started down that road commonly known as foreclosure knows, the experience can be extremely humiliating. Not only due to the feeling of failure for not meeting their financial obligations, but because of the seemingly constant hounding that will follow during the process. It may not only be rude and intrusive, but it may also be borderline illegal.

This is because your lender, once a particular time period is met, will file a notice that you are in default. That notice is not only recorded against the property, but the information is also publicized for the world to see. You become like shark bait in water!

In my experience, most people don’t go out of their way to stop making their payments. Sometimes they are financially strapped and find themselves in a financial ditch of which they can never climb out unless they get competent, experienced, and honest guidance. Instead, because they are stuck in that hole and have feelings of stress, isolation, and embarrassment, they feel like raw meat in the water being circled by bloodthirsty sharks looking to sink their teeth into them.

Many times, these sharks take the form of unscrupulous lenders who are looking to take a bite out of their equity with high-cost, high-interest loans that only tend to postpone the inevitable…while making themselves fat.

Sadly, sometimes real estate agents can have a little shark in them. Sometimes it can be inadvertent, but often it can be by devious design. You could find an incompetent agent approach you to sell without assisting you in understanding what your options are or what the consequences of your actions would be. Sometimes, you can be faced by an agent who knows that the fastest route to a quick buck is at your expense.

Many times, these sharks take the form of so-called "investors" whose only interest is to steal your hard earned equity and leave you in a worse situation than before. And believe me, it can get worse than just going into foreclosure and losing your home.

I have represented clients in foreclosure where a shark will convince them to put them on title. Next, they would file bankruptcy. Unknown to most people, this will delay the foreclosure process…for a while. Their hope is to delay the process long enough to negotiate with the current lender, bring the mortgage current in some fashion, then dump the original owners on their way to making a big fat profit! At least, that is their plan, but it doesn’t always work that way. And whether it works or not, you are left for financial road kill. Funny, the late night real estate program they purchased made it seem so easy!

However, the system is getting wise to this tactic and anyone who is a part of this scam could be charged with fraud. The owner could also be charged with additional fees and lose the home anyway. Of course, with the new bankruptcy laws, this practice may not work any more. But you now have a shark on your title and you will now have a difficult time trying to get rid of him.

However, the best defense against these threats is to be better educated. In virtually every state, there are rules to protect the owner. However, these rules are never explained to those they are meant to protect. Therefore, it is the owner’s responsibility to be proactive in knowing what these rules are and who to trust in assisting them in solving their problem.

How can you do this? Simple. You must find someone who is trustworthy in helping you get through the process. In my career, I have assisted many nice people who are in foreclosure. Often, I can steer them in the right direction, perhaps even assist them in getting a "sensible" loan that will allow them to keep their home, not just postpone the inevitable. And of course, sometimes they just aren’t in a position to keep their home and they must sell it and start over. I will help them sell it at a reasonable price, not some rock-bottom value that gets them nothing. And I do this for a reasonable fee, not some inflated commission that will break them.

This is just another reason why everyone should have a handful of professionals you can turn to when you are in need, instead of having to thumb through the phone directory for some unknown person when you are in trouble. You need to have a plumber, a mechanic, a dentist, and, of course, a Realtor®. If you wait until you have problems to find someone to assist you, then you are dealing from a weaker position. These sharks, like all others, smell blood in water and will tear you to shreds.