March 11, 2008 — Model Law

The foreclosure crisis has presented the perfect opportunity for foreclosure rescue scams. These scams come in two main varieties. In the first, a foreclosure “consultant” takes an up front payment and promises to arrange refinancing or postpone the foreclosure, but does nothing and costs the homeowner not only money but critical time. In the second, the rescuer takes title to the property “temporarily” with the promise that the homeowner will get it back, a promise that always fails. These sale/leaseback scams are designed to steal the home’s equity.

NCLC has drafted a model state law designed the combat the more complicated sale/leaseback scams. Our model law builds upon but differs from the two approaches that some states have enacted.