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Mortgage Rescuing Scams – Raleigh Consumer Protection Law


North Carolina has recently enacted consumer protection laws to protect individuals from mortgage-related scams.  There are certain types of home sale transactions which bring about inherent risks of fraud, including foreclosure rescue transactions, lease purchase agreements, and installment contracts for the purchase of real estate. Failure to provide tenants/purchasers with proper disclaimers in their written agreements can subject a party to penalties under North Carolina Unfair and Deceptive Trade Practices laws as well as, conceivably, state and federal Debt Collection statutes.  Businesses engaged in legitimate real estate transactions must be aware of these restrictions while home owners should be aware of their options if they have unknowingly entered into one of these agreements.  Contact the Raleigh civil lawyers of Maginnis Howard, PLLC at 919.526.0450 if you have questions about mortgage rescuing scams.

A foreclosure rescue transaction takes place where a homeowner faces foreclosure and is told their home can be “saved” by giving title to their home to a third party who would allow the seller to continue living in the home and would catch the homeowner up on their mortgage payments.  These transactions can lead to a homeowner giving up their equity in the home to the “rescuer” and receiving nothing in return.

A lease purchase agreement takes place when a property owner leases a home to a renter with an option to purchase. The renter frequently has an upfront option fee or pays a higher monthly rent for that option.   If the renter is late with one or two rental payments, the property owner can declare the option to void the lease, having collected the extra money from the renter.

Installment contracts for purchase of real estate or seller financed contracts take place where the seller retains title to the property while it receives payments from the purchaser, often letting the purchaser take the space while it begins to pay off the purchase.  However, if the purchaser misses one payment, the seller might attempt to declare that the purchaser’s rights have been forfeited along with the money paid as part of the purchase price.

While there are risks of fraud, these transactions are often legitimate.  If you are engaging in a legitimate form of these transactions, utilizing the business law firm of Maginnis Law, PLLC to ensure that the contracts between the parties are in compliance with these new laws can save parties from exposure to liability down the road.  The firm can assist in making sure these legitimate transactions are treated as such.

If you are a home owner or home-purchaser who has been involved in a mortgage rescuing scam, contact the consumer protection attorneys at Maginnis Law, PLLC for a consultation regarding your options.  Maginnis Law, PLLC is a Raleigh civil litigation law firm with civil lawyers handling matters in Raleigh, Cary, Apex, Wake Forest, Morrisville and the rest of the Triangle area.  Contact the firm at 919.526.0450 to speak with a Raleigh civil lawyer or submit a new case inquiry here.