Are You Falling Behind on Your Mortgage Payments?

Mortgage foreclosures are up; interest rates are up; and the number of houses for sale that are languishing on the market is up. About the only thing that is "down" these days is the troubled homeowner who is having difficulty making his or her mortgage payment.

The Better Business Bureau has developed a new educational resource - BBBTips™ for Troubled Homeowners --to assist those who fear they can longer afford to meet their mortgage obligation.

"Whether you are a couple of months behind in your mortgage payment or a couple of weeks behind, there are positive steps you can take to protect the value of your investment. The BBB wants troubled homeowners to know that they are not alone and they are not without options," said Steve Cole, president and CEO of the Council of Better Business Bureaus.

"Troubled mortgage-holders are no exception. BBBs are assisting with an increasing number of complaints about foreclosure 'rescue' businesses that promise homeowners a fail-safe solution. Victims report unknowingly signing over the deed to their house; having to pay rent to live in their own home; or confronting a buy-back deal that exceeds the value of their home," Cole said.
BBBTips™ for Troubled Homeowners outlines the options that are available to financially-pinched homeowners, from those who are anxiously awaiting a "reset" of their adjustable rate mortgage to those who may already be on the road to foreclosure.

The BBB system's new educational resource is available online at www.bbb.org/tips/clearpoint.

Topics include:

• Reasons behind the current rise in mortgage foreclosures;


• Advice for homeowners on assessing their personal situation;


• Steps to take if you can't make your monthly mortgage payment;


• Seeking assistance from a non-profit housing counselor; and


• Avoiding foreclosure "rescue" scams.

BBBTips™ for Troubled Homeowners is sponsored by ClearPoint Financial Solutions, Inc.™, a System-wide member of the Better Business Bureau. This is the latest release in a series of BBBTips™ resources on credit and debt issues.

"We join with the BBB to provide practical information to help homeowners who are worried about losing their homes. The sooner they develop a plan of action, the greater their chances to improve their financial situation," said Dan Oelrich, President and CEO of ClearPoint.

The BBBTips™ program supplements other helpful information provided by Better Business Bureaus to promote an ethical marketplace. In 2006, the 129 BBBs serving communities across the United States and Canada helped consumers and businesses with more than 105 million instances of service.

Beware of Debit Card Fraud

Banking industry losses due to debit card fraud exceed $600 billion annually. This is being done by skimmers – criminals who steal card information and use it to make purchases or withdraw cash from accounts – who make PIN and signature purchases as well as (mainly) ATM transactions. The skimming takes several forms: hacking into payment networks, attaching a skimming device to an ATM or merchant terminal, installing cameras to capture data, or simply looking over shoulders and memorizing PINs.

The Better Business Bureau (BBB) of Mississippi offers the following tip to help consumers avoid falling victim of debit card fraud:

• Monitor Your Statements. Closely monitor bank statements and balances. ; report problems to your bank. Contact your bank immediately if your card is lost, stolen, or subject to fraudulent use. Keep receipts for checking bank statements; if they contain your full account number, shred them before discarding


• Protect Your PIN (Personal Identification Number). Keep a record of card numbers, PINs, expiration dates, and toll-free phone numbers (in a locked, secure place) for banks for easy use in case of theft. Memorize your PIN, and do not make it available to others. Never write your PIN on your card, and do not use numbers which are easy for you to remember, such as your birthdate. Remember, crooks can often guess these numbers after doing a little easy research on you. Do not allow people to look over your shoulder when entering your PIN in machines. Do not give out your PIN over the phone (even if the caller claims to be from a law enforcement agency).


• Eliminate Blank Spaces on debit slips (such as the "tip" line on restaurant bills) so that the total amount cannot be changed.

For more information about avoiding debit card fraud, the American Bankers' Association provides information on its website at http://www.aba.com/Consumer+Connection/debitcardfraud.htm.

BBB Warns Consumers of Nationwide Locksmith Swindle

The Better Business Bureau (BBB) is warning consumers to beware of untrustworthy locksmith companies that are ripping off consumers across the country.

Victim complaints to the BBB reveal that several locksmith companies, all using similar methods, are significantly overcharging consumers, charging consumers for unnecessary services, using intimidation tactics, and failing to give refunds or respond to consumer complaints.

“Ironically, these companies operate under names like ‘Dependable Locksmith’ but in reality they exploit the vulnerable situation of consumers who are locked out of their house or car,” said Steve Cox spokesperson for the BBB System. “We’ve found that some locksmiths have made taking advantage of consumers’ misfortune part of their business model.”

Complaints about locksmith services to the 114 BBBs serving the U.S. increased almost 75 percent from 2005 to 2006, and have continued to come in steadily during the first half of this year.

The BBB has identified Dependable Locksmith – which operates under more than a dozen different names – as a particularly disreputable locksmith. This company poses as a local locksmith in cities across the country and advertises in the yellow pages using local phone numbers and fake local addresses. A consumer might think they’re dealing with a local locksmith but their phone call is actually connected to a call center located in the Bronx borough of New York City.

Consumers are quoted a reasonable price over the phone but when the locksmith arrives – typically in an unmarked vehicle – he demands significantly more money than originally quoted, often only accepting cash.

A complaint from Cleveland, OH, where Dependable Locksmith was operating under the name “Superb Solutions,” alleges the company quoted fees of $39 and $84 for separate jobs, but the bill ended up at $471, which included add-on fees such as a $65 breaking in fee and a $58 fee to uninstall old locks.

Another complainant reported that the locksmith sent to let her into her car demanded she pay twice the price quoted over the phone. The locksmith offered to drive her to an ATM to get cash – feeling unsafe, the victim refused. The victim was ultimately forced to write a check made out personally to the locksmith as he would not let her into her car until she did so. She cancelled payment on the check the next morning, but eventually filed a police report after the locksmith harassed her with continuous phone calls about payment.

The BBB has also heard many complaints from victims who say they were charged for unnecessary services. For example, complainants suspect locksmiths sent over by Dependable Locksmiths of pretending they couldn’t simply pick the lock so that they could charge more and install all new locks in homes.

Some of Dependable Locksmith’s aliases include, Superb Solutions, Locksmith 24 Hour, Inc., USA Total Security, Priceline Locksmith, and S.O.S. Locksmith.

Two other locksmith contractors fleecing consumers are Basad, Inc. – which operates under more than 50 names nationwide, such as A-1 Locksmith Service, A-1 24 Hour Locksmith, A-1 Lock & Key Locksmith, and AAA Locksmith 24 Hour – and Liberty Locksmith. Similar to Dependable Locksmith, they pose as local locksmiths and run full-page yellow pages ads with multiple phone and address listings. The phone numbers appear to be local, but connect to national call centers such as Liberty’s in New York City, while the addresses end up belonging to other established businesses in the local area, or are simply non-existent.

Liberty Locksmith had been a BBB member in Tulsa, OK, but during normal BBB member validation processes, it was discovered that the addresses provided by the company were false. In June 2007, the BBB terminated the membership of Liberty Locksmith for providing false information in its membership application and providing misleading advertisements to the public.

Like others, Liberty Locksmith and Basad, Inc. use common cons such as quoting one price over the phone, but then charging significantly more on site.

“These companies are very good at posing as trustworthy locksmiths,” said Mr. Cox. “Before you find yourself in the unfortunate position of being locked out of your car or house, do your research and find a truly dependable locksmith in your area. Ask around and always check with the BBB first to find reputable businesses.”

If you feel you’ve been taken advantage of by Dependable Locksmith, Liberty Locksmith, Basad. Inc., or others, please contact the BBB to file a complaint, or do so online at http://www.bbb.org./

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Know the Facts about Reverse Mortgages

For older homeowners who are looking for a way to tap into the equity they have built up in their homes over the years, a reverse mortgage can be a good solution. Reverse mortgages allow homeowners to turn their home equity into spendable cash without having to make monthly interest or principal payments.

Under a reverse mortgage, the lender sends the borrower money via a lump-sum payment, a line-of-credit, monthly check or a combination of all three. The homeowner is not required to pay back any of the loan advances or interest until the loan term is over. Generally, no repayment is due until the borrower no longer occupies the house.

Before venturing into a reverse mortgage the Better Business Bureau, along with the Federal Trade Commission suggest that homeowners consider the following facts:

• Reverse mortgages are rising-debt loans. The interest is added to the principal loan balance each month, because it is not paid on a current basis. The amount you owe increases over time as the interest compounds. Some reverse mortgages have fixed-rate interest; others have adjustable rates that can change over the lifetime of the loan.


• Reverse mortgages use up some or all the equity in your home, leaving fewer assets for you and your heirs.


• There are three types of reverse mortgages — Federal Housing Administration (FHA)-insured, lender-insured, and uninsured — and these vary according to their costs and terms. Check the features of each to select the type that is best-suited for your needs. Before considering any reverse mortgage, consult with family members, your attorney, or financial advisor.


• Reverse mortgages typically charge loan-origination fees and closing costs. Insured plans charge insurance premiums, while some plans have mortgage servicing fees. You may be able to finance these costs if you want to avoid paying them in cash. But, if you finance the costs, they will be added to your loan amount and you will pay interest on them.


• Your legal obligation to repay the loan is limited by the value of your home at the time the loan is repaid. This could include any appreciation in the value of your home after your loan begins.

The federal Truth in Lending Act (TILA) is one of the best protections you have with a reverse mortgage. TILA requires lenders to disclose the costs and terms of reverse mortgages. This includes the Annual Percentage Rate (APR) and payment terms. If you choose a credit line as your loan advance, lenders also must tell you of charges related to opening and using your credit account.

Before signing any contracts for a reverse mortgage, be sure to check on the reliability of the company with the BBB at http://www.bbb.org/. The BBB also provides complaint and dispute resolution assistance for consumers to seek recourse and achieve a fair settlement if they have been treated unfairly in the lending process.

For more specific information about reverse mortgages contact the Home Equity Information Center of the American Association of Retired Persons (AARP) or go to http://www.aarp.org/money/revmort//.

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