The Federal Trade Commission has released a video for consumers on how to avoid foreclosure rescue scams. This is extremely useful. Many states are now in the process of prohibiting foreclosure rescue transactions outright.

For example, the Massachusetts Attorney General has promulgated 940 CMR 25.02 prohibiting all for-profit foreclosure rescue transactions.

Foreclosure rescue (as opposed to foreclosure defense or loan modification) is a transaction where homeowner at risk of foreclosure conveys their home to the foreclosure rescuer, but retains the option to lease or buy back the property later. The terms of the lease or repurchase are usually so onerous that the homeowner is unable to get their home back, and they lose the house and have any remaining equity stripped by the rescuer.

Never enter into any type of foreclosure prevention transaction without consulting a lawyer. Culik Law provides free consultations for loan modification for Massachusetts homeowners

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