The Star-Ledger

Newarkers Try To Stem Foreclosure Scams

Groups remove signs, hear Mayor Booker

The Star-Ledger — Sunday, April 6, 2008

Star-Ledger Staff

Michael Heard was part financial consultant, part city code enforcer yesterday afternoon as he spoke to Newark residents about home foreclosures and ripped down signs.

"I'm angry," he said shortly after taking down two signs in his neighborhood in the West Ward of Newark that claimed to get people out of foreclosures or offered to buy homes on the cheap. "People work very, very hard. They have aspirations, but sometimes they don't know about the proper way of doing things."

Heard was one of dozens of volunteers in bright orange T-shirts who swept through all five wards of the city yesterday armed with fliers and door hangers to warn citizens against foreclosure and mortgage scams designed to prey on the elderly or the desperate.

It was the first day of outreach organized by the Newark/Urban Essex Foreclosure Task Force, a coalition of community organizations, government officials and nonprofit groups. The task force wants citizens to know they have other options and avenues to avoid foreclosure – without going through shady brokers or lenders.

The brightly colored signs, which can be seen on nearly every block in some parts of Newark, say "Avoid Foreclosure," usually followed by a toll-free number and promises of a quick close on a home sale. Some say they offer cash for homes or even $1,000 for referrals.

And with more than 1,000 homes projected to be in foreclosure in the next 18 months, community organizers and government officials want homeowners to act before it's too late.

Phyllis Salowe-Kaye, from the Citizen Action group, said homeowners are faced with a number of scams. There are ploys to have owners sell their homes, live in it as renters, but then later face eviction when they can't keep up with payments. Others are tricked into signing papers they don't understand, unknowingly signing their property away to the lender. Some agencies approach people desperate for a way to save their home asking for a service fee to negotiate with the bank, only to disappear without a trace.

Salowe-Kaye said her organization has seen a 40 percent increase in crisis counseling for homeowners over the last year.

"We're aggressively approaching homeowners so they can avoid foreclosure," she said.

Essex County has seen 4,794 foreclosure filings in 2007, according to numbers released by Newark Mayor Cory Booker's office. In Newark, 1,400 owner-occupied homes are under foreclosure, according to Rutgers University's Bloustein School for Planning and Public Policy, a key member of the task force.

After canvassing neighborhoods, volunteers gathered in the yard of a dilapidated home that had been in foreclosure, but then was bought by Episcopal Community Development to be rehabilitated and sold as affordable housing. Booker spoke to about 100 volunteers and politicians who had come out for the event.

"I'm tired of driving around my city and seeing these signs," Booker said, pointing to the dozens of blue, red, yellow and green signs volunteers had torn down around the city and brought to the meeting. He said he was so sick of seeing them, he stopped at Home Depot to buy a crowbar that he keeps in his car. He tears down signs whenever he sees them. It's illegal to post any kind of sign on utility poles and trees.

"We're going to make our city an example of how people pull together for the cause of justice," he said.

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