How to avoid foreclosure scams in California

When you're behind on payments, the calls and letters start: people promising they can "save" your home. Some are honest. Some take your money, or even your house. Here's how to tell the difference and what the law says.

Red flags

Be very careful with anyone who:

Asks for money upfront to save your home, get you a loan modification, or stop a sale
Guarantees they can stop or postpone your foreclosure
Tells you to stop paying your servicer and pay them instead, or to stop talking to your lender
Wants you to sign over your deed or title so you can "rent it back" and "buy it back later"
Pressures you to sign today, or hands you papers you haven't had time to read
Asks for a power of attorney, or for your online banking logins
Offers to "recover" leftover money from a foreclosure sale in exchange for a fee or a share

Four rules that protect you

Never pay upfront fees. California law says a foreclosure consultant can't collect any fee until every promised service has been fully performed. The same goes for anyone charging to arrange a loan modification. Free help is available from HUD-approved housing counselors: (800) 569-4287.
Never sign over your deed without a lawyer. The California Attorney General warns that "rent it back, buy it back later" offers are a common scam. Before you sign any deed or transfer of your home, to anyone, including a buyer like us, have a licensed attorney review it.
Only pay your mortgage to your servicer. Use the address or phone number on your official statement.
Read everything before you sign. Some homeowners think they're signing loan papers and find out later they signed away their home. Take the papers home, and have someone you trust read them too.

Your cancellation rights, in plain words

If you hire a "foreclosure consultant" (Civil Code 2945)

A foreclosure consultant is someone who, for pay, offers to stop or postpone your foreclosure, deal with your lender, or otherwise "help" with it. California law says:

The contract must be in writing, spell out the services and the total fee, and include a notice saying they can't take money until they've finished everything or ask you to sign a deed. You can cancel until midnight of the 5th business day after you sign. You can cancel in writing, by mail, fax, or email to the address in the contract, in any words that say you don't want the deal.
They can't take any fee until all the work they promised is fully done.
They can't take a power of attorney from you, and they can't acquire an interest in your home.

If you sell your home while it's in foreclosure (Civil Code 1695)

If you live in the home and a Notice of Default has been recorded, a sale to an investor-buyer comes with extra protections:

The contract has to follow specific rules and include a cancellation notice.
You can cancel until midnight of the 5th business day after you sign, or until 8 a.m. on the day of the foreclosure sale, whichever comes first.
Until that time runs out, the buyer can't take or record a deed from you, transfer your home, or pay you.
The buyer can't mislead you about the home's value, what you'll get, the contract terms, or what a document means.

These rights apply to us too. Any purchase contract we sign with a homeowner in foreclosure will include the required notices.

How to check someone out

Housing counselor: confirm they're HUD-approved at consumerfinance.gov/find-a-housing-counselor or (800) 569-4287.
Attorney: look them up on the State Bar of California's attorney search.
Real estate licensee: look them up on the California Department of Real Estate's license lookup.
Your servicer: call only the number on your statement, never a number from an unexpected letter or text.

If you think you've been scammed

If you transferred your property or paid someone to "rescue" you, the California Attorney General says you may be the victim of a crime.

California Attorney General, Public Inquiry Unit: (800) 952-5225 (TTY (800) 735-2922)
Consumer Financial Protection Bureau: (855) 411-2372
A licensed attorney or local legal aid office, especially if you signed a deed

How we do things

We're a company that buys houses, and we say so up front. We're not foreclosure consultants: we don't charge homeowners fees, we don't negotiate with lenders, and we don't promise to stop or postpone anything. If we make an offer, it's in writing, with every cost shown, and you're welcome to have an attorney review it before you sign.

Want to talk with a buyer who's upfront?

We'll explain any offer we make line by line, in writing, and we'll always encourage you to have an attorney review it before you sign. No fee, no pressure.

See My Options

Or call (909) 999-1339, 8 AM to 8 PM Pacific.