Real estate can generate high yields as an investment and provide stability for homeowners. Many people aspire to buy a home, but some people fall behind on mortgage payments. 

Falling behind on mortgage payments can increase a person’s stress and put them at risk of scammers. Scammers can get heartless and exploit people during their darkest and most vulnerable moments. A recent large-scale foreclosure rescue scam in the Southern District of Ohio demonstrates the risks and why people must stay alert.

Understanding what took place in the Buckner operation can help homeowners become less susceptible to scams and discover the warning signs in advance.

While it’s obvious that homeowners don’t want foreclosures, it’s good to remember that lenders don’t want a foreclosure either.

What Happened in Ohio?

Rising inflation has affected many parts of the country, making it more difficult for people to afford their homes. While the cost of living has gotten more challenging in recent years, it has never been easy for everyone.

From 2013 to 2018, a scammer by the name of Lorin Kal Buckner defrauded at least 780 financially distressed homeowners throughout the United States. 

Ohio was the epicenter of this fraud, as over 100 individuals in the Southern District of Ohio lost their homes. Buckner will face 10 years in prison. Ten co-conspirators were also charged in the scheme. 

How the Scheme Operated

Buckner created multiple fraudulent companies to hide his tracks and deceive hundreds of homeowners. His entities were MVP Home Solutions, LLC, Bolden Pinnacle Group Corp., and Silverstein & Wolf Corp. The first two LLCs on this list operated under multiple names, making it more difficult to untangle the web. 

Buckner and his co-conspirators recruited affiliates who searched databases for financially distressed homes. They reached out to homeowners and pitched Buckner’s companies. In the marketing copy, Buckner assured homeowners that he could stop their foreclosures and save people’s homes. Affiliates received commissions for promoting the scheme. Service prices ranged from $995 to $1,625 per month.

Through his companies, Buckner promised to perform various services, including the following:

• Negotiate with lenders on behalf of homeowners.
• Remove mortgage liens with tender offers.
• Negotiate a home sale to avoid foreclosure.
• Stop an immediate foreclosure.
• Achieve short sale prices at a fraction of the outstanding lien’s value.

Buckner had many individuals file Chapter 13 bankruptcies, a process that delays foreclosures. He informed victims that filing Chapter 13 bankruptcies can shield them entirely from foreclosure. Bucker never listed himself as a preparer of any bankruptcy filings and listed the victims’ names instead. This approach made it easier for Buckner to conceal his operation and stay under the radar. 

If a company does not have an online presence or reviews, it can be a bad sign.

Warning Signs of the Scheme

It’s easy to highlight a scheme once it has already been unfolded, but what about schemes happening right now? Homes are getting more expensive, and interest rates are rising. This creates the optimal environment for future scammers. 

This foreclosure rescue scam targeted financially vulnerable people. These scammers take advantage of people’s stress and lack of expertise in legal matters. When you make any important decision, assess your thought process. If you feel stressed or pressured by the seller, you may want to pause a bit and do more research before making a decision.

Buckner and his company encouraged affiliates to use aggressive sales tactics to convert more homeowners into clients. These tactics show that a seller cares far more about receiving a commission than helping a victim get out of foreclosure. People’s internal interests do not always align with what they say. Aggressive selling is a common tactic among scammers, and it serves as a warning sign.

When determining if an offer is a scam or legitimate, consider how legitimate businesses operate is important. Many businesses have an online presence and let customers leave reviews on sites like Yelp and Google. If a company does not have an online presence or reviews, it can be a bad sign. Legitimate businesses often point to case studies and give customers an easy way to verify the truth. 

Many scammers request wire transfers, just as Buckner wanted from his victims. Wire transfers are harder to get back than other types of transfers.

Foreclosure is stressful, but you must stay sharp when someone promises to provide a quick solution that sounds too good to be true.

Getting Out of Foreclosure

Homeowners and investors buy properties hoping they will never have to worry about foreclosure. Rules vary by state, but the foreclosure process can start if you miss four consecutive monthly mortgage payments. The proceedings can take over a year.

While it’s obvious that homeowners don’t want foreclosures, it’s good to remember that lenders don’t want a foreclosure either. A foreclosure puts the lender in the hole, and some lenders try to work with borrowers to avoid that scenario. You can negotiate with your lender to see what it would take to avoid a foreclosure. Resuming your mortgage loan payments can be a good start.

People go into foreclosure because of their finances. They don’t have enough money to cover mortgage payments due to a loss of income, rising cost of living, medical expenses, and other reasons. 

Tapping into side hustles and income growth opportunities is the best protection against foreclosure. Working more hours can make a difference, but developing skills that offer higher salaries can make a more meaningful difference. 

Requesting a mortgage forbearance and getting approved can give you time to generate and save extra income. A forbearance gives you a temporary break from mortgage payments. 

You can also extend your loan’s duration to minimize the monthly payments by refinancing it. However, borrowers should consider interest rates and fees, especially the former. Refinancing could result in a more expensive loan if you secured a lower interest rate for your previous loan, but adding a significant number of additional years to your loan can make it more manageable. 

The right professionals can offer assistance and give you suggestions. Not everyone is unethical like Buckner. Do your research and think it over before letting a salesperson or business owner cajole or persuade you. You can simplify your research by reaching out to a HUD-approved counseling agency.

If you can’t make the payments, you can exit your home through a short sale or a deed in lieu of foreclosure. A short sale takes place when a homeowner sells their property for less than the market price to get a quick sale. The homeowner can use these proceeds to pay off the loan. Some banks will forgive the loan even if the proceeds from a short sale are less than the loan’s remaining balance.

A deed in lieu of foreclosure allows you to hand off the deed of your house to the bank and free yourself from the mortgage. However, you will be giving the bank ownership of your home. It’s the last resort for avoiding foreclosure proceedings if you know you won’t be able to keep your home.

Foreclosure is stressful, but you must stay sharp when someone promises to provide a quick solution that sounds too good to be true. Scammers make bad problems worse and often prey on society’s most vulnerable.