Massachusetts goes after mortgage predators
KAI RYSSDAL: Dig into those jobs numbers Nigel Gault was telling us about and you get a pretty good picture of the housing industry. Still sagging. Not much residential construction going on. In part, because of the subprime mortgage market.
In Massachusetts today a state official issued emergency regulations to stop what she calls widespread fraud. Fraud that’s targeting people in danger of losing their homes. The Bay State’s Attorney General Martha Coakley said scam artists who promise to rescue homeowners from foreclosure are actually out to steal those homes.
Foreclosures are on the rise in Massachusetts, as elsewhere. So Coakley said she’s looking at increased regulation of other deceptive mortgage lending practices too.
Marketplace’s Steve Tripoli has the story.
STEVE TRIPOLI: Rescue scammers promise homeowners help with refinancing or selling their homes. But Attorney General Coakley says that kind of help often comes at too high a price.
MARTHA COAKLEY: A predator-rescuer comes in to say “I can help,” but demands that the property itself be turned over to the rescuer. And what is a bad situation, and may end up in losing the home or losing equity, becomes immediately worse and actually mostly irreparable.
Coakley says these rescue schemes are, “rife with fraud.” They often include illegally misleading promises. And they leave distressed homeowners with little recourse — hence today’s emergency action.
Coakley also wants to hear what the public has to say about other mortgage lending practices that she says are frequently unfair or deceptive.
COAKLEY: Particularly when the borrower’s income is overstated, or when the loan is made at a very small rate for the first two years that balloons up.
She says these practices cause more than lost homes. They’re also causing urban blight in Massachusetts as lost homes are boarded up. It’s a problem nationwide. Coakley says other states may be zeroing in on rescue schemes, as well as other questionable lending practices.
COAKLEY: I am certain that other states, whether it’s with their attorneys general or their secretaries of state or the legislatures are all looking at how this came about, and looking at ways to fix it.
Coakley also appealed to private Massachusetts lawyers today. She wants them to offer free help to homeowners facing foreclosure while efforts to draw up new laws are underway.
I’m Steve Tripoli for Marketplace.
KAI RYSSDAL: Dig into those jobs numbers Nigel Gault was telling us about and you get a pretty good picture of the housing industry. Still sagging. Not much residential construction going on. In part, because of the subprime mortgage market.
In Massachusetts today a state official issued emergency regulations to stop what she calls widespread fraud. Fraud that’s targeting people in danger of losing their homes. The Bay State’s Attorney General Martha Coakley said scam artists who promise to rescue homeowners from foreclosure are actually out to steal those homes.
Foreclosures are on the rise in Massachusetts, as elsewhere. So Coakley said she’s looking at increased regulation of other deceptive mortgage lending practices too.
Marketplace’s Steve Tripoli has the story.
STEVE TRIPOLI: Rescue scammers promise homeowners help with refinancing or selling their homes. But Attorney General Coakley says that kind of help often comes at too high a price.
MARTHA COAKLEY: A predator-rescuer comes in to say “I can help,” but demands that the property itself be turned over to the rescuer. And what is a bad situation, and may end up in losing the home or losing equity, becomes immediately worse and actually mostly irreparable.
Coakley says these rescue schemes are, “rife with fraud.” They often include illegally misleading promises. And they leave distressed homeowners with little recourse — hence today’s emergency action.
Coakley also wants to hear what the public has to say about other mortgage lending practices that she says are frequently unfair or deceptive.
COAKLEY: Particularly when the borrower’s income is overstated, or when the loan is made at a very small rate for the first two years that balloons up.
She says these practices cause more than lost homes. They’re also causing urban blight in Massachusetts as lost homes are boarded up. It’s a problem nationwide. Coakley says other states may be zeroing in on rescue schemes, as well as other questionable lending practices.
COAKLEY: I am certain that other states, whether it’s with their attorneys general or their secretaries of state or the legislatures are all looking at how this came about, and looking at ways to fix it.
Coakley also appealed to private Massachusetts lawyers today. She wants them to offer free help to homeowners facing foreclosure while efforts to draw up new laws are underway.
I’m Steve Tripoli for Marketplace.
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