LAS VEGAS (KSNV MyNews3.com) -- When the housing crisis hit, people were desperately looking for help. In this Rip-Off Alert from New York, some fell for bait-and-switch scams.
Nerida Cuccia was in the market to refinance her mortgage.
“They made a tremendous offer,” she said. “And at first I thought, ‘Too good to be true.’ ”
Ricardo White said he could offer her a 3.25 percent fixed interest rate the first year and 5 percent fixed for the remainder of the loan.
She told white she was interested; she also told him his tone made her hesitant. “You’re so high pressure,” she told him. “You sound a little bit like you’re forcing me into something.”
He quickly apologized and, because of the attractive rates, Cuccia decided to proceed with the refinancing.
“People get pulled in by the numbers,” she said. “And then they get -- in the end -- pay a high price.”
Postal inspectors began tracking the case and found it was a classic bait-and-switch scam at closing.
“They would misrepresent the terms of the loans to induce the consumers into refinancing,” said U.S. Postal Inspector John Marsh. “The homeowners unwittingly got a very high adjustable rate mortgage, and the fraudsters got a nice commission.
“They will have you sign documents that say 2.25 or 3.25 percent fixed. But that is not true; that is a fraud.”
At the same time, the con artists will have victims sign more documents for the actual mortgage they plan to submit to banks — with much higher rates.
In Cuccia’s case – she was promised 3.25 percent: in reality she signed a loan that started at 8 percent the first year and would go as high as 15 percent.
“The documents they leave with you in no way shape or form will tell you what the terms of the loan are,” Marsh said.
This is done by design and is at the heart of the scam.
“They don’t want you to realize you have been hoodwinked and cancel the loan in three days, which is the standard practice with loans,” Marsh said
Cuccia’s closing with White was held in her home.
“I felt like somebody walked into my house and robbed me blind,” she said.
Postal inspectors say White along with the ring leader, Gregory Cooper, scammed more than 50 victims out of more than $2 million.
Cuccia was able to refinance again but lost more than $20,000 in closing costs for both transactions.
“To be able to face Mr. White in court and tell him how I felt nothing could ever -- the money, nothing -- was as important as being able to look at his face once more and know he was going to jail,” she said.
Postal inspectors say if you are in the market to refinance, always do your homework and reach out to reputable financial institutions. You should never feel pressured to sign papers that you cannot read and evaluate at the time of closing.