Refund Tracers Scam

Most often, this scam tells you how you can help people get their HUD refunds. For a price, they’ll send you a package on starting this wonderful, helpful business. You can feel good about helping people get the money they are owed, right?

Not in this case! There is a very simple form on the HUD website that people can fill out in order to get their refunds if they are owed one. Not exactly something they ought to pay for, it’s so easy.

The FTC and HUD do take action against companies that contact people who are owed HUD refunds and tell them that they must pay in order to get their refund. This scam is a path to legal troubles. You cannot tell people that they must pay to get their refund; they can find out for free on their own. Now if they want to pay, well, that's their choice.

Another way to get into trouble on this is to make false claims about your association with HUD or FHA. Refund tracers are third parties, not a part of HUD or FHA.

Also note that the time on HUD refunds is running out. Loans must have originated before 2005 to have a chance at being eligible, unless the borrower refinances to another FHA loan, and then no refund is due after the third year of insurance. There are still a lot of refunds due, but the process of finding out if you're due one is extremely simple now, even if the paperwork may be a bit tedious.

Yes, you can do this, but it's not the simple matter the people selling the opportunity would have you think.

If You Get Scammed

First try to clear it up with the company. If they are uncooperative, let them know that you will be contacting officials about the matter. Then do it.

• If you found out about the company on a website, let the site know so that they can take it off their site.
• Post your story on the Ripoff Report, so that others can see your story.
• Contact the Attorney General in your state or the state the company is in.
• Contact the BBB, both your local office and in the company's state.
• Contact the National Fraud Information Center if this was a "get rich quick" or "easy money" scheme.
• Your local Consumer Protection Offices.
• The Postmaster if you recieved the offer in the mail.
• The Federal Trade Commission. Although the FTC does not handle individual complaints, they are on the lookout for patterns of deception and unfair practices. To register a complaint, write to: Correspondence Branch, Federal Trade Commission, Washington, DC 20580.

 

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