Mortgage Elimination Scams Explained

There are many mortgage elimination programs that are currently making the rounds in an attempt to take advantage of people. These mortgage elimination scams can cause serious problems for those that fall victim to them. Here are the basics of mortgage elimination scams and how they typically work.

Mortgage Elimination Scams

The basic idea behind a mortgage elimination scam is that a scam artist tries to convince unwitting subjects that they can easily get out of their existing mortgages. They use unscrupulous tactics in order to convince people who are unknowledgeable about financial topics to give them money. In return for a substantial amount of money, scam artists claim, they will reveal a system that can help people get their property free and clear. Unfortunately, this does not carry any weight in the real world. Therefore, those that try it will often end up in worse shape than they were before.

Invalid Loans

Many of these mortgage elimination scams operate on the claim that mortgage loans are invalid. They try to convince people that no money actually changed hands during the closing process, and therefore, no money was transferred. They use a concept that is often referred to as "vapor money" in order to make people believe that they can get out of their mortgage. They try to convince people that these mortgages are invalid because no money was actually transferred from one party to another. They will also bring up the fact that lenders typically sell mortgages to another company without actually transferring the title. They tell you that since you have the title, you are the true owner of the house regardless of what you signed.

Idea of Money

Many mortgage elimination scams will also try to get you to believe that money is a figment of your imagination. They want you to believe that the bank was paid the moment that you signed the mortgage. They try to convince you that they use this commercial paper in order to get money immediately upon closing. Then, you also send them your mortgage payment every month and the bank gets paid twice for the same mortgage. Therefore, if you were to stop paying for your mortgage, they would not actually be out any money as a result of this process.

Subsequent Loans

Many of these scams will also encourage unwitting mortgage holders to try to borrow against the property for a second time. They will start out by filing a fake loan release to the county clerk. This will make the property look as if it were free and clear. From that point, they can fill out a fake loan application and take out another loan on the property. Many times, the scam artists will require that the homeowner give them as much as half of the proceeds from the loan. This process might happen two or three times before anyone catches on to what is happening. By that time, the scam artists are long gone with the money, and you are left with a very bad legal and financial situation.