NiaW

$300k foreclosure fraud!!

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Hi guys!! Ok, so I wanted to come on here and ask for you guys' advice for a friend of mine. Here's the HUGE problem....

 

He has a $300,000 foreclosure PLUS some credit cards on his account. The problem is..... the foreclosure is a house that his mother purchased when he was 18 and tricked him into cosigning for it because he had great credit. She basically told him that he was signing for the house in case anything happened to her... it would go to him without any issues. This is when he knew nothing about this type of stuff. He just signed the papers. He didn't find out until he was like 21 and went to go buy a house with his ex and found out he had a foreclosure on his credit. 

 

THEN...not only that but just about a year and a half ago him and his mother got into it really bad because he found out that she had opened some more credit cards in his name. He tried to dispute it with the credit companies but they didn't believe him because he was living with her and the credit card bills were the same address as his. 

 

as far as the foreclosure, he was told the only way to get it off his credit was to file fraud and he didn't want to do that because he didn't want to send his mother to jail. She's done this so many times and it really pisses me off. Her and her sister were doing it together, except her sister wasn't doing it to her own family members. Her sister actually got caught and went to jail for 2 years.  :complainer:  XhairX

 

This is a very touchy situation. I told him to let me help him try to repair his credit because I am doing pretty good in my journey but he is convinced that nothing can be done about the foreclosure especially. I would really appreciate all the help we could get on this subject!!!  

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He has a $300,000 foreclosure PLUS some credit cards on his account. The problem is..... the foreclosure is a house that his mother purchased when he was 18 and tricked him into cosigning for it because he had great credit. 

 

THIS is the biggest problem with the foreclosure:  as a co-signor he is equally responsible for that mortgage as Mom is.  It doesn't matter what Mom told him only that he was 18 and legally able to enter the contract.  There may be little he can do to remove it.

 

He needs to let go of any emotional issues with this and start handling it as a legal matter.  The CRAs and creditors are NOT going to take his word for it that Mom opened credit accounts without his permission.  That he lives there just supports that he knew or participated.  However, if he files a police report and a FACTA complaint then they will take it seriously regardless of where he lives.  If he doesn't lawsuits could be coming his way when she defaults on those cards and he does NOT want judgments in his name for her misdeeds.

 

Unless he stands up and starts treating this as the legal matter it is Mom will continue to take advantage of him and destroy his credit future.  

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So what about just disputing as "not mine" like we do everything else? Would that not work in his case? Because he is going to get a P.O. box  to protect his privacy. He will be moving in april, thankfully. 

No, it will not work.  He will say "this isnt mine".  The CRA will then notify the creditor, who will most likely verify the trade line as accurate.  Then the CRA will continue to report it as it is.  He would need some sort of documentation--evidence--that it is not his.  And in a case like this, the documentation he would really need is a police report. 

 

I hate to see things like this happen.  but unfortunately, your friend is in a position where he must choose what his priority is going to be.  he has two choices--protect his mom from legal problems, or protect his financial future.  There is no way that I can see where he can do both at the same time.  At this point, if it were me, and I were that young, I would have to act to protect my future.  Her actions will come back to haunt him for years otherwise.  I understand it's his mother, but sometimes the best thing you can do for someone is put them in a place where they are forced to deal with their own actions and choices.  Scamming people is one thing...scamming family is a whole different beast.  This is not a decision that should be approached lightly, but it IS a decision he must make.

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No, it will not work.  He will say "this isnt mine".  The CRA will then notify the creditor, who will most likely verify the trade line as accurate.  Then the CRA will continue to report it as it is.  He would need some sort of documentation--evidence--that it is not his.  And in a case like this, the documentation he would really need is a police report. 

 

I hate to see things like this happen.  but unfortunately, your friend is in a position where he must choose what his priority is going to be.  he has two choices--protect his mom from legal problems, or protect his financial future.  There is no way that I can see where he can do both at the same time.  At this point, if it were me, and I were that young, I would have to act to protect my future.  Her actions will come back to haunt him for years otherwise.  I understand it's his mother, but sometimes the best thing you can do for someone is put them in a place where they are forced to deal with their own actions and choices.  Scamming people is one thing...scamming family is a whole different beast.  This is not a decision that should be approached lightly, but it IS a decision he must make.

 

 

Unfortunately if he wants to fix the credit issues, he's going to have to proceed with the filing of a police report against his mother.  

 

 

THIS is the biggest problem with the foreclosure:  as a co-signor he is equally responsible for that mortgage as Mom is.  It doesn't matter what Mom told him only that he was 18 and legally able to enter the contract.  There may be little he can do to remove it.

 

He needs to let go of any emotional issues with this and start handling it as a legal matter.  The CRAs and creditors are NOT going to take his word for it that Mom opened credit accounts without his permission.  That he lives there just supports that he knew or participated.  However, if he files a police report and a FACTA complaint then they will take it seriously regardless of where he lives.  If he doesn't lawsuits could be coming his way when she defaults on those cards and he does NOT want judgments in his name for her misdeeds.

 

Unless he stands up and starts treating this as the legal matter it is Mom will continue to take advantage of him and destroy his credit future.  

This is the worst. I did tell him, he is better than me. Because I would've reported her right after that foreclosure crap. But then again...easier said then done. I will definitely let him know. But it's not something he didn't already know. I was just hoping I could help in some way. Thank you guys!

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Since others have defeated OCs in collection suits it is clearly possible to do so, when scammed by a family member, without necessarily filing a police report.

 

Defeat in court of an OC collection suit prevents an adverse judgment. Cleaning the CR should be doable if the merits of "not my account" were actually adjudicated.

 

It isn't easy and I have no experience as to the cost of a competent winning consumer attorney to defeat an OC. The OP's friend should probably consult with one to assist in determining their best course of action.

 

The foreclosure is going to be extremely hard to remove from a CR barring proper reporting of the fraudulent behavior IMHO. Loan fraud involving/incidental to the federal government and/or their GSEs is likely to be taken with extreme seriousness (unless you have the initials N.A. after your name).

 

I would want to look into the foreclosure statutes and law to see if there was full compliance on things such as notice to the "co-borrower". I would read all the loan documents mortgage/DOT a couple of times to understand them thoroughly. It is a long-shot. Again a consult with an competent attorney with expertise in the subject matter would likely be valuable in determining the best course of action relative to the circumstances and goals of the defrauded party.

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Call me naïve here, but since when does an 18 yo have such good credit that he can cosign on a $300K mtg?  He couldn't have "just signed".....they would have wanted pay stubs, tax returns, etc.

 

He lives with his mom and never saw CC bills in his name?

 

Something does not sound right here........

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Since others have defeated OCs in collection suits it is clearly possible to do so, when scammed by a family member, without necessarily filing a police report.

 

Defeat in court of an OC collection suit prevents an adverse judgment. Cleaning the CR should be doable if the merits of "not my account" were actually adjudicated.

 

It isn't easy and I have no experience as to the cost of a competent winning consumer attorney to defeat an OC. The OP's friend should probably consult with one to assist in determining their best course of action.

 

Are you SERIOUSLY advocating for this kid to wait until he has been sued by creditors for his mother's illegal activities and then HOPE he can defeat them?   That is the DUMBEST plan I have ever heard. 

 

This is NOT this kid's debt and as painful as it is to turn your own mother in, he cannot allow her to get away with it.  She will continue to do this to him or someone else until she is held responsible for her actions.  

 

Give me ONE valid reason why he should live with bad credit because of someone else using his identity?  The person being his mother is NOT a reason.

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Call me naïve here, but since when does an 18 yo have such good credit that he can cosign on a $300K mtg?  He couldn't have "just signed".....they would have wanted pay stubs, tax returns, etc.

 

He lives with his mom and never saw CC bills in his name?

 

Something does not sound right here........

Keep this in mind--this home purchase would have taken place a few years ago, when they were still giving out mortgages like candy to just about anyone.  Chances are good that it wasnt his credit that the bank was interested in, but the fact that he probably worked at the time.  Back then, the banks were more than happy to sign up just about anyone for just about anything...and if he was employed, then all the better for the bank.  Doesnt make it right but I hope it clears up some of the confusion. 

 

I would agree that at 18 he would not have had some great credit rating....also, if he did by chance have good credit, he would have known the papers he was signing by simply reading even just a little bit of them. 

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Are you SERIOUSLY advocating for this kid to wait until he has been sued by creditors for his mother's illegal activities and then HOPE he can defeat them?   That is the DUMBEST plan I have ever heard. 

 

This is NOT this kid's debt and as painful as it is to turn your own mother in, he cannot allow her to get away with it.  She will continue to do this to him or someone else until she is held responsible for her actions.  

 

Give me ONE valid reason why he should live with bad credit because of someone else using his identity?  The person being his mother is NOT a reason.

I think you misunderstood.  He was saying that, now that the guy was already sued in a foreclosure action, that there are people who have won against an OC without the need for a police report.  He then advised that the guy speak with an attorney.  He NEVER said to wait until other creditors sue him, then try to beat it that way.  In your quoting him, you left off the rest of his post, which makes it clear that he is talking about the foreclosure situation that the guy was already sued over, and not about additional creditors filing additional lawsuits.  And in this case, he is correct--the OC already did the foreclosure.  He's talking about how the guy can act now to get the end result overturned and off the credit report. 

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@Credator Ok then, we will definitely have to look into that. Sounds like it's going to be a lot of work but well worth it. He was considering just filing bankruptcy but I didn't think it was a good idea. Some have had good turnout from it, though.

There is NO WAY I would even begin to consider filing bankruptcy to avoid getting the proper authorities involved in this mess.  His credit is already taking a hit...why would he put it further down the toilet when you say he supposedly had great credit? 

 

Now I am starting to agree that things do not add up in this deal.  Something's missing from this story, I think.

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Now I am starting to agree that things do not add up in this deal.  Something's missing from this story, I think.

 

Not necessarily.  If Mom opened up a bunch of credit accounts using her son's social security number and kept them in good standing until he turned 18 then that social could have EXCELLENT credit.  Enough that they would allow him to co-sign on a mortgage if her income was sufficient on its own.  

 

It appears that Mom defaulted after the mortgage was obtained.  She probably defaulted on the CCs at the same time.

 

I do agree that simply filing BK so that he has to live with it and she walks away is the WRONG thing to do.

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He's not "better" than you. If what he's telling you is true, he's protecting his mother from the consequences of criminal behavior.

 

That's not a good thing. For him, or for her. 

 

In order to get this behind him, if he can, he DOES need to file a complaint against her.

 

And, because she seems to have neither boundaries nor shame, he may want to consider getting a new SS number, and never ever ever letting her know what it is.

 

I was married for a long time to an alcoholic. I've seen people destroy their own lives out of a misplaced sense of duty to a criminal. If I were you, I'd share this information with your friend, and then walk away and not look back. He's not likely to take the advice, and his behavior is unhealthy to be around. 

 

Your goal is to clean up your act. His is to protect his mom.

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I don't think a fraud complaint would even come close to working on the foreclosure.  He signed the loan docs, some of which require notarization, which means he would have had to provide ID at the closing.  The credit cards, definitely a different story.  I would file on those immediately.  Several years ago, I was in a similar situation with my brother.  As soon as I found out about it, I contacted the police and filed a report.  It worked out pretty well for me, not so well for him...but it was his actions that put him in that position.

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I don't think a fraud complaint would even come close to working on the foreclosure.  He signed the loan docs, some of which require notarization, which means he would have had to provide ID at the closing.  The credit cards, definitely a different story.  I would file on those immediately.  Several years ago, I was in a similar situation with my brother.  As soon as I found out about it, I contacted the police and filed a report.  It worked out pretty well for me, not so well for him...but it was his actions that put him in that position.

 

You might be jumping to a conclusion on this.  I have heard of more than one incident involving mortgages that took place during that same time frame where paperwork was not signed properly.  Even in my own mortgage, the "notary " that signed the papers did not even do so until after the day of signing.  We went to the lender's office, signed documents, and were told that we would receive copies in the mail of everything we had signed.  We were only given a copy of the actual mortgage agreement that day and told to hold onto this copy until our official documents arrived.  Well, I never got rid of that copy because when the "official" papers arrived, there were copies of all of the disclosures, but there was no official copy of the mortgage agreement.  So we kept ours.  Years later, our mortgage lender(HSBC) committed all kinds of fraud and tried to foreclose on us....that was when we learned that they had acted illegally.  HSBC filed ordinary process against us and included a copy of the mortgage agreement that is on file with our county clerk's office.  Their copy was notarized...ours was blank on the notary line.  We were buying our first home, and had no idea exactly what would be required of us at the day of signing, so no one asked for our ID's.  We did not know until later on that we were supposed to show them to a notary because there was no notary present that day at the signing.

 

For all we know, the lender could have actually told the mom to take the documents to her son and bring them back signed.  It has happened.  So many lenders were writing so much paper, so quickly, that a whole lot of details got overlooked. 

 

In my case, we went to the lender's office and signed everything there, and they still did it illegally.  So there's no way of knowing exactly how this went down in the OP's case.  And since it's his friend, and it happened years ago, there's not a whole lot that can really be done about it today other than to file fraud charges against his mom. 

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Fraud in the inducement may apply to the "victim" relative to the foreclosure. I don't know. That would be a good question for a competent attorney.

 

Assuming the truth of the the portion of the tale shared in this thread, I am unclear why the "victim" should not consult with a competent attorney(s) that has applicable subject matter expertise and I continue to recommend that course of action.

 

Those attorney(s) would likely review "all relevant factors", provide information as to the options available, and explain the ramifications of the options. At that point, the "victim" could make an informed decision based on their priorities and goals. Priorities/goals that I do not presume to know nor attempt to dictate to them and that in turn causes me to be unwilling to suggest a plan of action for the "victim". Well, other than, see a competent attorney.

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