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After
the Sale: «
Back: Closing
« Not all of the junk mail is bad,
though. Often the mailings
you receive will contain valuable coupons, such as
10-20% off at a home improvement or home
furnishings store. You'll also get offers for
credit cards with attractive promotional rates
(e.g., 0% for six months), which can help you
finance repairs or initial purchases for your new
home. On the other hand, some of the mailings are
worse than junk mail -- they're actually scams.
And they're not even obvious scams, either
-- it's very, very easy to be taken in by them.
They'll have a company name that sounds impressive
and may even sound like some kind of government
agency, to try to get you to sign up for their
homestead, finance, or insurance services. Often,
there's no appeal letter, just an official-looking
form, worded so that you think it's official and
that you have to return it. Many tax jurisdictions give you a small break
on your property taxes for the house that you
actually live in (as opposed to any rental
property you might buy). This is called a
homestead exemption. You have to file for
the homestead exemption to get it, but it's a
simple one-page form that you can probably even
download off the Internet from your state
government's website, and it's completely free. I saw your page on the Homestead
Recording Service scam...after I fell
for it. It looked like a form 11.13
so I called the 800 number on the asked
for my money back and they said just write
refund on the yellow paper (the thing you
bought for $35) and they will issue a
refund check. Once you get the
document they ask for an additional $25 to
file it. -- Brent L., Jan. 2006 Now, right away, it seems official, because they
know the date I bought my house. But remember,
that's public information and anyone can get
it. The bit about "Our Records Show Filing" is to
get you to think that they're the ones who are
supposed to keep track of homestead filings, but
they're not. Your dentist doesn't have any records
of your homestead filing either. It's not his/her
job. To look even more legitimate, the reverse side
of the form is completely filled with the relevant
text from the Texas Constitution and the Texas
Property Code about homesteads. Scammers aren't
usually in the habit of quoting the law, are they?
So that seems to add to the credibility. Also,
instead of begging, like most sales letters, it
does the opposite. The form says, in all caps, "YOU
MUST USE THIS FORM OR WE WILL NOT PREPARE YOUR
DESIGNATION OF HOMESTEAD." You're supposed to include a $35 fee to get them
to file the paperwork to declare your home a
homestead. But this may not even be the same thing
as appyling for a homestead tax exemption,
and in any event, as I mentioned, you can do this
yourself for free. Other scams try to get you to sign up for a
biweekly mortgage payment schedule, with each
payment being half what you normally pay. The
idea is that you'll effectively make 13 payments
per year instead of 12, so you'll pay your loan off
sooner and save on interest. The thing is, you
don't have to pay your mortgage company or anyone
else to set you up on such a system. If you want to
pay down your loan quicker, you can make an extra
principal payment at any time. Just send a separate
check when you make your mortgage payment and write
"For prepaid principal" in the memo field. The worst mortgage scam tries to get you to
send your mortgage payment to someone else.
You'll get a letter saying your loan has been
transferred to another bank, and that you should
start sending your payments to the new bank
instead. Now, your loan might really be transferred
to a new bank, but don't take the letter's word for
it. Call your bank using the phone number on your
loan documents (NOT the number on any letter you
receive about the transfer!), and ask them to
confirm that your loan was really transferred to
who the letter says it was transferred to. Some scams try to sell you overpriced life or
disability insurance. They promise to make your
house payments for you in case you become unable to
work, or if you die -- so that your family won't
lose the house because they can't afford to make
the payments. Insurance of this kind can actually
be beneficial. What's scammy about it is that it's
usually overpriced -- you could often get a better
deal just by calling an insurance agent and buying
normal term life insurance. Plus, their sales
pitches are usually deceptive. Today I got a letter from "Home Mortgage
Group". Sounds official, huh? The top of the
letter lists the details of my mortgage -- which
bank I owe and how much. That also can mislead
people into thinking it's legitimate because they
list the particulars of your mortgage. But the
truth is, it's public information and anyone can
get it at the county courthouse -- or buy it from
some company who's already done so. The text of the
letter includes strong language such as "It is
important that you respond to this offer at this
time," as though it were some kind of
obligation. The insurance they're offering is overpriced,
too. I went online and the first price I found
was almost half what was offered in the
letter. I got a similar offer in an unmarked envelope,
no return address. The letter inside has no
letterhead. Instead, the top says: "Important
Notice - Complete and Return". Under that in
large letters it says: Lender: JP MORGAN CHASE
BANK But the letter didn't come from the bank, it
came from the scammer. They just put my bank's name
on it to make it look official. The name of the
bank holding the mortgage is part of the public
records -- anyone can get it. If you need insurance, get some quotes online
and buy from an insurance agent, not from some
deceptive come-on in a junk mailing. |
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