AG Warning: Beware of Bankruptcy & Mortgage Rescue Debt Scams
Offers Tips on Prevention
SANTA FE - New Mexico Attorney General Gary King says people facing foreclosures and seeking bankruptcy relief are being victimized by unscrupulous companies that are making their money problems worse, not better. Consumers are being contacted by companies that promise to save their houses for a fee, but do nothing to protect the homeowner. When it is too late, the company refers the homeowner into bankruptcy and may even find someone to fill out their bankruptcy petition. But, that person is usually not a lawyer and cannot represent the homeowner in the bankruptcy proceeding. A homeowner who files bankruptcy and represents himself may not fully know how to protect his home and may still lose it in the bankruptcy proceeding.
AG King says, “There are companies giving false hope to New Mexicans facing bankruptcy and the possibility of losing their homes because they can no longer make the monthly payment; on top of that, some of these firms are taking hundreds, sometimes thousands of dollars from people who are already deep in debt and the consumers are getting nothing in return except more debt.”
Assistant Attorney General James Jacobsen cites a recent court case involving a woman who owed $22,000 in credit card bills. Part of her defense was that she had paid $5,000 to a debt solution company to help her.
“But the company apparently pocketed the money and the woman received nothing to show for it,” says AAG Jacobsen. He adds, “She still owes the original debt, plus she’s out another five thousand dollars.”
For the rest of this article please visit www.nmag.gov.
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