Cease and Desist message from local police re: foreclosure help mailer

Landlord, Wholesaler and Agent · Newton, NJ · Member since 2013 · 97 posts · 46 votes

Hey all

Got a voicemail from the local police, saying You need to stop right away the "help with foreclosure" messages (yellow letter'd pre-foreclosures with auction dates in the next month or two) yadda yadda.. I heard there was some kind of legal aspect to this kind of marketing but I didn't pay attention, I'm just learning by doing and pursuing all routes.

I'm not worried at all about this by the way, but does anybody want to fill me in on how it's illegal to mail preforeclosures saying I can help them avoid the situation?

So the question is, are there any other marketing niches that can get the cops called on me?

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John Rooster

Denver, CO · Member since 2013 · 409 posts · 105 votes

12y

You are putting yourself forward as offering to help people in foreclosure and you don't even know the law? <eye roll>. It took me ten seconds to find this link which details the requirements of a foreclosure consultant in New Jersey.

http://www.nolo.com/legal-encyclopedia/new-jerseys-foreclosure-rescue-fraud-prevention-act.html

People like you make it embarrassing form me to tell people I am a Real Estate investor.

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Matthew Paul
Severna Park, MD · Member since 2013 · 7k+ posts · 7k+ votes
12y
Worry when the states attorney calls .
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Wayne Brooks
Real Estate Professional · West Palm Beach, FL · Member since 2012 · 23k+ posts · 13k+ votes
12y
Offering "foreclosure help" or foreclosure rescue puts you under a microscope as offering counseling type services, and opens you up to fraud accusations. Stick with we buy houses.
2 Reply
Don KonipolBusiness Member
Investor · The Woodlands TX / Avon, CT · Member since 2009 · 6k+ posts · 10k+ votes
12y
I don't know local ordinances in the area you mailed, but often these ordinances are misapplied or misinterpreted by law enforcement. Further, many local ordinances are actually found to be in violation of state or Federal law when contested. Best advise is to call law enforcement and ask which ordinance you are in violation of. Then contact competent attorney and have him research applicable law. If attorney's opinion is that you have acted within the law, have attorney send letter to law enforcement department applicable.
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Mary B.
Real Estate Investor · Lansdowne, PA · Member since 2013 · 1k+ posts · 656 votes
12y
I'd have to co-sign with Wayne Brooks. Adding that you definitely need to look into the Foreclosure laws of NJ. Remember these people are going through troubling times and don't always take kind to phantom mail or other strange contact regarding their current misfortune. Often they don't want to hear from anyone unknown to them. Even counselors have a difficult time reaching them. Although your angle is to help out(both them and yourself ;-)) put yourself in the shoes of a pre-foreclosure homeowner receiving tons of marketing mail....

Kudos,

Mary
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Zaid R.
Investor · Northridge, CA · Member since 2012 · 249 posts · 73 votes
12y
I agree with what both Don & Wayne said - stick to 'we buy houses' angle & call to see what code you're being accused of violating.

It also won't hurt to run this by a lawyer/experienced RE in your area to get their thoughts on this
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Rob K.
Investor · Southeast, MI · Member since 2012 · 2k+ posts · 1k+ votes
12y
Are you sure it was the police and not some clown just messing with you?
2 Reply
Bill Gulley
Investor, Entrepreneur, Educator · Springfield, MO · Member since 2009 · 21k+ posts · 12k+ votes
12y
I bet we have a guru type business behind this, just guessing, teaching someone an approach to "help" people facing foreclosure.

The police, or whom ever, may have been calling as to a sign ordinance but it could be that someone there is aware of federal law pertaining to these "help you in foreclosure" scams. By federal law you must be 1. an attorney, or 2. A licensed credit counselor, or 3. An employee of a non-profit credit counseling organization and all of whom must have experience in credit-foreclosure matters.

Anyone else who advertises to or approaches anyone with any plan or method of assisting anyone who has received a notice of foreclosure is in violation of federal law as a felony.

Obviously, anyone who is not aware of this is not even close to being qualified to assist people in foreclosure. They may think they are from learning some ploy, like asking for the original note, but they are in no position to actually carry through with such activities as that requires an attorney to file suit. So, many of these ploys are simply to slow the process of gum up the works allowing time for the "counselor/investor" to figure out some way to get a property sold. The reason the law was passed.

Another older federal regulation; Finance and banking laws and RE laws are intertwined that makes casting a net over a violator of one matter to be in violation of another or several laws. Anyone who interferes with the operations of any federally insured lender putting that institution at any financial loss is another violation. This violation seems to hover under fraud matters, if fraud can not be shown then this one will probably catch a violator. If you do things that cause bank employees to spend time addressing petty delaying tactics, they just caused a financial loss to the lender as those employees do get paid.

I'll bet dollars to pennies that Clayton is not a certified counselor as he would have been aware of applicable laws.

If the police contacted (or not as some aware type person has) you concerning your signs, you better cease and desist like yesterday, it's a felony, get out of the financial arena and stay in RE.

I saw people advertising this on CL here, I've also seen people asking for help. Frankly, I can or could help many of these borrowers, but I can't as I am not in compliance with the law and I'm not heading to court over the matter. :)
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Clayton P.
OP
Landlord, Wholesaler and Agent · Newton, NJ · Member since 2013 · 97 posts · 46 votes
12y
The person is definitely a real police officer haha, in a town not 15 minutes away from my doorstep.

Long story short, I contacted the officer back the next day, left a voicemail with him saying something along the lines of... Hey officer so and so, this is Clay, I agree to stop the mailers right now, but be aware that those letters people brought to you were mailed out in a batch of over 200 letters, so if after now you get more complaints, it's not that I kept mailing, it's that the letters from the original batch might still be circulating... so I covered my bases that way, then as I wrapped up the voicemail, told him to feel free to call me back and explain to me how I crossed the line.

Haven't heard anything back yet but either way, no harm no foul.

PS - thanks Bill, very informative
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Bill Gulley
Investor, Entrepreneur, Educator · Springfield, MO · Member since 2009 · 21k+ posts · 12k+ votes
12y
Clayton, I doubt the officer will call you back. It's not really no harm no foul, you may not know that for some time. Obviously, a letter went to, or got to, someone who may have been aware of the law, might have been an attorney who deals in foreclosure who called the police. Another letter could end up on a prosecutor's desk who decides to act on it. Complaints can go directly to the prosecutor too.

You bring up a good point too, for those that do mass mailings, the law doesn't exempt you. So, your letter really needs to avoid speaking to any foreclosure issues so that it can be regular old junk mail when it's opened by someone in foreclosure. If you're just saying I want to buy your house, there's no issue with that. Any one in foreclosure can figure out if they sold they would avoid the issue.

Be careful about how you word your promotional materials. :)
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John Rooster
Denver, CO · Member since 2013 · 409 posts · 105 votes
12y

You are putting yourself forward as offering to help people in foreclosure and you don't even know the law? <eye roll>. It took me ten seconds to find this link which details the requirements of a foreclosure consultant in New Jersey.

http://www.nolo.com/legal-encyclopedia/new-jerseys-foreclosure-rescue-fraud-prevention-act.html

People like you make it embarrassing form me to tell people I am a Real Estate investor.
3 Reply
Clayton P.
OP
Landlord, Wholesaler and Agent · Newton, NJ · Member since 2013 · 97 posts · 46 votes
12y
^haha! guess you get embarrassed a lil too easy then sweetheart.

**for the record, I'm learning as I go, & I'm not attached to your or your business, so it shouldn't bother you so much. Sure I might add a little to the stigma of shaaaady real estate people as I'm LEARNING, but who really does more damage, little old me making a couple mistakes as I learn by doing, or the guys out there who intentionally snake people out of their money by "teaching", guys even I'VE met at my early level, at REI meetings just doing one big upsell and stealing money from naive people. Really man, who's doing more damage.

I'm not afraid to take my bumps as I go, but you going out of your way just to rub it in my face, on the internet, is pretty embarrassing on your part.
2 Reply
Bill Gulley
Investor, Entrepreneur, Educator · Springfield, MO · Member since 2009 · 21k+ posts · 12k+ votes
12y
Clayton, you need to get away from gurus and start with a good foundation in RE with the basics, conventional educational information, including applicable laws and regulations before you hit the streets trying to do things. You're not alone, many are where you are from being guruized by a few selling bad information. But what you do out there is on you, not them. Kinda like that saying about, if someone said it was cool to jump off a bridge, would you jump?

Lots of people are in jail who were innocent following the advice of others, not really an excuse.

There is the school of hard knocks, those lessons can be expensive but none should be from doing illegal activities, now you know.

You'll also find that any industry will have self policing issues as those that do unethical or illegal activities placing the public or others at risk reflects on all in that industry. I agree with you, gurus should be held to a much higher standard, but newbies keep following them. It's not them getting into illegal activities, it's the folks that follow their advice, like jumping off a bridge.

Just back up and dig in and learn before leaping, learn what is acceptable in your area too as all RE is local. Good luck :)
0 Reply
Duncan Taylor
Real Estate Investor · Member since 2013 · 866 posts · 487 votes
12y
Originally posted by @Clayton P.:
^haha! guess you get embarrassed a lil too easy then sweetheart.

**for the record, I'm learning as I go, & I'm not attached to your or your business, so it shouldn't bother you so much. Sure I might add a little to the stigma of shaaaady real estate people as I'm LEARNING, but who really does more damage, little old me making a couple mistakes as I learn by doing, or the guys out there who intentionally snake people out of their money by "teaching", guys even I'VE met at my early level, at REI meetings just doing one big upsell and stealing money from naive people. Really man, who's doing more damage.

I'm not afraid to take my bumps as I go, but you going out of your way just to rub it in my face, on the internet, is pretty embarrassing on your part.

I hope you like wearing orange stripes. Or are they using blue in NJ? Wait, foreclosure advice? That's fed, yep blue, dark blue. :)
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Robert AdamsBusiness Member
Real Estate Broker · Henderson, NV · Member since 2009 · 1k+ posts · 373 votes
12y
You should take it a little more serious and change your strategy to fit inside the local laws. You are correct that you are learning as you go and sometimes that is fine but when you begin to break laws and just claim to be ignorant of the law that will leave you in a bad spot. A judge will not care that you didn't know the law. They will say you should have researched it prior to acting.

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Patrick L.
Real Estate Investor · Saint Petersburg, FL · Member since 2013 · 1k+ posts · 951 votes
12y
"I'm just learning" isn't an excuse for breaking the law and if you were arrested for a crime it certainly wouldn't be a defense that helped you at all. You need to learn and then act, just winging it isn't a viable plan.
0 Reply
Rob Anderson
Real Estate Investor · Champaign, IL · Member since 2013 · 114 posts · 55 votes
12y
Originally posted by @Clayton P.:
Hey all

Got a voicemail from the local police, saying You need to stop right away the "help with foreclosure" messages (yellow letter'd pre-foreclosures with auction dates in the next month or two) yadda yadda.. I heard there was some kind of legal aspect to this kind of marketing but I didn't pay attention, I'm just learning by doing and pursuing all routes.

I'm not worried at all about this by the way, but does anybody want to fill me in on how it's illegal to mail preforeclosures saying I can help them avoid the situation?

So the question is, are there any other marketing niches that can get the cops called on me?

Haha. . . Keep going this route and I bet your first/next RE Investment will be a nice 6X9 piece of property. 1 bed maybe 1/2 bath if your lucky. You can rent out half of it to a nice guy name bubba to help offset your holding cost. Get a 15 to 30 year term depending on how good you are a negotiating. If your smart maybe a few years in you can flip it. use a 10/30 exchange, deffer capitol gains tax and re-invest into an 8x10. Just a thought. Good luck!!! Your going to need it.
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Clayton P.
OP
Landlord, Wholesaler and Agent · Newton, NJ · Member since 2013 · 97 posts · 46 votes
12y
sooo... no police follow up, almost 3 weeks later... and I've been taking in about 10-15 calls per day off my recent mailer.... so I'd say everything is going well. Definitely lesson learned.
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Larry Chafe
Real Estate Investor · Redondo Beach , CA · Member since 2012 · 21 posts · 7 votes
12y
Clayton,

Glad the situation didn't develop into something more. I had some of my mailings looked over by an RE attorney I had on retainer at one time. And he said the same thing basically; Avoid using the words or "stop foreclosure" or "foreclosure" at all. Google "MARS Act", this is the federal law (in addition to any state laws) you need to be in compliance with.

But don't let this discourage you. There are alot of honest RE investors like us out there, that are providing a useful service to people in trouble and are honest and not scam artists. My mailing say something like this now: " If you're behind on payments, that's OK, we often buy from people behind on payments". And "we can help you avoid any negative consequences". You could also say something like "don't be a victim of the bank".

If a police officer or anyone ever calls you and asks about it, and what you do to help them. I would tell them: " I buy their house from them". Then they are helped, and they no longer have the problem. No scam, doesn't cost the homeowner any money.

So don't be discouraged by this, and keep marketing.

Larry
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