Indio, Calif. - Nearly 10,000 homes have been put into the process of foreclosure this year in Riverside County.
When a notice of default is filed, it becomes public record. Scam artists are taking that information and using it to trick homeowners into giving them money.
"There's people out there that are scamming. Trying to say they will try to save their home for 'X' amount of dollars," said Riverside Assessor-County Clerk-Recorder, Larry Ward.
But, Ward says, that is not the way things play out. The people saying they can offer loan modification services get money from distressed homeowners up front, then do nothing to stop the home from being foreclosed on.
"Typically what happens is they don't do anything," Ward said. "The homeowner ends up being foreclosed on, and they're out additional money."
Riverside County Assistant District Attorney, Sean Lafferty, says some home owners are so desperate and disoriented from a foreclosure filing against them, they sign over the title to their house.
"We've even found some people that are engaging in deceiving people out of their title," Lafferty said. "Turning over the deeds to their homes with the idea that maybe they can rent back and stay. Of course the fallout is people are losing their homes and have been defrauded out of several thousands of dollars, if not more."
In a combined effort to stop the scam artists, the Riverside County Clerk and District Attorney's Offices have joined together to begin mailing a Foreclosure and Loan Modification Advisory Letter to home owners who have had notices of default filed against them.
It notes that once a Notice of Default has been recorded, it is illegal for a foreclosure consultant to collect fees in advance of services. It also points property owners towards the free resources offered by http://fairhousing.net, www.LoanScamAlert.org, and www.hud.gov/fha.
"Every time we turn around there is a new fraud scam out there," Ward said. "We think this will hopefully put a dent in it."
With the housing market stabilizing, foreclosures in Riverside County have been cut by more than half what they were a year ago. More than 21,000 homes went into default in 2012. This year the number will be around 10,000. The Advisory Letters just began going out this September.
"Well, recently, the District Attorney, they have a fraud fee, and that went up," Ward explained. "So we actually can pay for it. As I mentioned earlier, we're going to be sending out ten thousand of these a year, so it's about $20,000 dollars to do this. So basically, it was a money issue."
The D.A.'s office says they have received over 30 complaints of real estate fraud, and they have prosecuted several of the cases.
"We are moving in a direction of being more aggressive with this," Lafferty said. "And we're going to have, at some point, a real estate fraud deputy assigned to the Indio division, as well as the Murietta Division. With investigative help to kind of help us get on track with this."
People who feel they have been a victim of real estate crime can call (877) 723-7779 or e-mail REFraudUnit@RivCoDa.org. There is also a Real Estate Complaint Form on the District Attorney's website at www.RivCoDa.org.