SACRAMENTO, Calif. (Legal Newsline) - California Attorney General Jerry Brown issued a consumer alert on Thursday warning homeowners to be wary of a prevalent scam that targets those with rapidly declining property values.
According the attorney general's office, companies are sending deceptive mailers to homeowners offering help in reducing property tax assessments if they pay the company hundreds of dollars in fees.
"This blatant and costly scam holds out hope to homeowners that their property taxes will be reduced if they pay hundreds of dollars to a middleman to have their property re-evaluated," Brown said. "In point of fact, homeowners can seek relief directly from their county assessor free of charge. Homeowners should be on high alert."
The companies use names like "tax adjusters," "tax readjustment," or "Tax Review" according to a press release issued by the attorney general, which Brown believes deceives customers from assuming they are dealing with a government agency.
Property tax reassesment is a free service provided by county tax assessors. Brown urged homeowners to never pay a middle-man for these services. Those who believe they may have been a victim of these scams can contact the attorney general's office.
This latest scam adds to the woes of California homeowners already suffering from having one of the highest foreclosure rates in the country. For example, in August, more than 100,000 new foreclosure filings were posted in the state, tops in the country. That number was still above 50,000 in October, according to data provided by RealtyTrak, an online foreclosure sales company.
California was also one of the first two states to negotiate a billion-dollar settlement with Countrywide Financial Co. for its predatory lending practices in 2008.
Terms of the settlement with Bank of America, parent company of Countrywide, included a program that bank officials said would "systematically modify troubled mortgages with up to $8.4 billion in interest rate and principal reductions for nearly 400,000 Countrywide Financial Corporation customers nationwide."