MS. REBECCA SHEIR
We turn now from how Washingtonians move around to where they live. We've heard a lot over the past few months about our local housing market picking up, but actually many home owners are still struggling with debt. And increasingly, they're desperation is making them a ready target for scam artists. Jacob Fenston has the story.
MR. JACOB FENSTON
Luis and Margarita Garcia moved to Montgomery County in 1999.
MS. MARGARITA GARCIA
Yes, we are a family of immigrants that came from a El Salvador.
At first, they lived crammed into a single bedroom.
My children, my husband and me.
After six months they worked their way up to a basement apartment, then a larger apartment above ground. Then, just five years after coming to the United States--
We had the opportunity to have the American dream, to have our own house.
MR. LUIS GARCIA
I will say it like it was like a pretty, pretty amazing feeling. Like one of your goals was done.
We came from nothing. From nothing and then--your house. It's amazing.
That was 2004. When the recession hit, they were in the absolute wrong lines of work. Margarita cleans houses and Luis is a heating and cooling technician. His company cut his hours.
And for me, too, I started losing some of my jobs.
Suddenly, between the two of them combined they had the income of one part-time job.
I don't know how to say that sentence. We left behind on the payments.
We were behind on them.
We were behind on the payments. We cannot afford it in that time.
But they were determined not to lose the house. Margarita researched programs to help homeowners and she applied for a loan modification to lower their payments.
I cannot tell you how many times we apply for a modification.
At one point they found a man who promised to help, a realtor.
It was $500.
And he made them pay upfront. He did help them with paperwork, but he also lied to them.
We found that he was doing our signatures. He falsified those signatures.
He botched their application and he made them pay for services that nonprofit, government-backed groups provide for free.
Manuel Ochoa moonlights as a radio host at a station in Wheatland, Md. He does a weekly show about housing and credit called “Consejos Financieros”.
Ochoa's real job is at the Latino Economic Development Center, a non-profit that offers free housing counseling. He says the majority of his clients have already been scammed by the time they find their way into his office.
MR. MANUEL OCHOA
That's really the main reason why we decided to go ahead and have a radio show, is to combat the scamming and the misinformation that was taking place.
Ochoa's group worked with the Garcias, who finally after four years were granted a loan modification late last year. Montgomery County, where the Garcias live, is among the jurisdictions with the highest foreclosure rates in Maryland, making it a target for scammers. They're also targeting Prince George's County, ground zero in the local foreclosure crisis.
MR. STANLEY YOUNG
I got the number off the TV. They had a commercial on TV.
Stanley Young, who drives a delivery truck for a living, got behind on his payments on his Prince George's house in 2008. He was in a pinch and didn't know where to turn.
And I called the number and the guy was asking me for my routing number to my checking account. And so I said, why do you need my routing number to my checking account?
Eventually, he saw an ad for a free and legitimate housing counselor, who helped him work with the bank. Just this month, he got the news, he was okayed for a loan modification, extending the loan, but bringing down his payments.
I'm back on track. That's what I needed. I needed a fresh start.
He's one of the fortunate ones. In his zip code in Prince George's, one in five homeowners has gotten a foreclosure notice in just the past year or so.
MS. MARY HUNTER
It's just the bubble hit this county very hard.
Mary Hunter directs the counseling program at the housing non-profit HIP Services, in Hyattsville. In the past few months, foreclosures in Maryland have spiked after two years of much lower rates. Hunter says that's in part because of a law passed in Maryland in 2010 requiring banks offer in-person mediation to homeowners before foreclosing.
That year, we saw this sort of what was really an unofficial moratorium. It gave us a chance to really work with the banks and, you know, under less pressure of the foreclosure sale.
Borrowers like Stanley Young and Luis and Margarita Garcia were able to use that unofficial moratorium to get help and work out a solution with their lenders to keep their houses. But housing counselors worry there are many more homeowners who aren't doing that. Instead, they're just getting farther and farther behind, meaning that with each passing month the prospect of holding onto their homes becomes more remote. I'm Jacob Fenston.
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