O’CONNELL: LAW TO PROTECT HOMEOWNERS FROM DEED THEFT
(MINEOLA – March 10, 2008) County Clerk Maureen O’Connell advises homeowners facing foreclosure that the New York State “Home Equity Theft Prevention Act” regulates companies that offer foreclosure assistance. Many of these companies employ unscrupulous tactics, including the misrepresentation of foreclosure rescue assistance. Specifically, targets are likely to include the elderly or those desperate to save their homes.
The most common form of deed theft and unfair dealing occurs when a homeowner facing foreclosure agrees to deed his home to an investor or other party in exchange for payment of his missed mortgage payments. Promises are made to the homeowner that he may continue living in his home by renting it from the investor and buying it back once his financial situation has improved. However, the homeowner is often evicted; the investor either sells the property to a third party, banking all the equity, or cashes out the home’s equity with a new mortgage, leaving the homeowner with monthly payments that are unaffordable.
The law protects people who are in foreclosure or default and are considering selling their home. Its purpose is to provide homeowners with information before deciding to sell or transfer their home to an equity purchaser. For those considering the option of foreclosure assistance, the law requires reconveyance arrangements be recorded by the purchaser simultaneous with the deed in the County Clerk’s Office. The reconveyance arrangement grants the seller an option to repurchase the property, unless otherwise shown, for a period of time when the financial difficulties that caused them the default can be resolved.
As the number of foreclosures in Nassau County climb, it is critical that homeowners be wary of unscrupulous companies or individuals who offer the ability to stop foreclosure proceedings or assume mortgage payments. For a copy of the law, visit the State’s website at: www.assembly.state.ny.us or www.senate.state.ny.us and type in bill numbers A.10057B or S.4774A, or contact your local State Representative.