26 • The Beacon October 31 , 2024
This solicitation looks like a notice about your mortgage
If you get an unexpected letter from your mortgage company , look closely . According to numerous BBB Scam Tracker reports , the letters are a deceptive solicitation for a home warranty service . Here ’ s how to spot the scheme .
How the scam works
You receive a letter that appears to come from your mortgage provider . It ’ s allegedly from the company ’ s “ home warranty department ” and claims your home warranty must be renewed .
Before worrying , look closely at the letter and see what ’ s happening . One BBB Scam Tracker report noticed : “ At the very bottom of the letter in small print is the comment , ‘ Not all consumers have previous coverage . We are not affiliated with your current mortgage .’”
Another homeowner reported : “ The mailing is made to look like a check . It has the tear-away sides and inside is a ‘ renewal fee voucher ’ for $ 199 . It ’ s not a check ; it ’ s an attempt to get you to sign up for a home warranty .”
If you don ’ t read the fine print ( or it doesn ’ t appear in the letter you receive ), you ’ ll likely be concerned your home warranty has lapsed and your mortgage is at risk . You won ’ t be dealing with your mortgage lender if you call the number and “ renew ” your warranty . Instead , you will have given money and personal information to a company that employs deceptive advertising tactics .
One consumer shared their experience with BBB Scam Tracker : “ My grandmother received a paper in the mail that said ‘ final notice .’ She called the number on the paper . The man on the other line tried giving her a home warranty deal of $ 234 . This mail she received looks like a check with the amount $ 199 on it with her name in bold letters . He agreed that her payment would be that monthly . She gave him her debit card info , where he took exactly $ 199.86 out on June 18 , 2024 , for this ‘ home warranty .’”
This scheme is similar to the extended car warranty calls . The product may be real , but there are several things to consider before buying an extended warranty . Also , you want to avoid doing business with a company that resorts to misleading sales techniques .
How to avoid mortgage and home warranty scams
— Go to the source . If you receive any correspondence about your mortgage or home warranty that you aren ’ t sure about , don ’ t use the contact information in the message . Instead , call your lender directly to inquire about the matter . Look up their contact information separately on your mortgage bill or search for your lender ’ s customer service line on their website .
— Watch out for highpressure offers or threats . Don ’ t let scammers pressure you to act immediately , even if they say you could lose your home . If someone tries to use scare tactics , stop communicating with them and contact your bank or lender directly .
— Never provide your financial information over the phone to someone you don ’ t know . If you ’ re being asked to urgently pay for something over the phone , hang up . Never provide your credit card or banking information over the phone and be aware of common red flags of scams like paying for something with a prepaid gift card , a wire transfer or through a digital wallet app .
— Shopping for a home warranty ? Do your research first . Evaluate several options and read the terms closely before signing a contract .