Home Rescue is a Hamilton based outfit which claims to prevent
mortgagee sale. It can't - even its spokesman admits "it doesn't
work". In return for a service which doesn't work, some people have
paid thousands of dollars. No homes have been rescued. Home Rescue
can't or won't produce a single case where a mortgagee sale has
actually been prevented.
Thousands of dollars for nothing
The most disturbing thing about this story is the money which has
gone for nothing. Clients are persuaded to sign up, stop paying
their mortgage, and start paying Home Rescue. They claim the money
went on "office expenses". It certainly didn't go toward paying
mortgages.
The Home Rescue website - now down - used to say "for a small fee,
your obligation to pay the Mortgage is then nullified". It wasn't
small fee, and the obligation wasn't nullified.
Barbara Charnley from Auckland's North Shore is 86 years old. She
got in money trouble after a loan for which she was guarantor went
sour. But instead of talking to her family and her bank, she was
advised to talk to Home Rescue. She joined up, stopped paying the
mortgage, and started paying Home Rescue $200 per week. In all, her
family say she paid out $4600. Unsurprisingly, her bank was going
to sell her up, but by chance her daughter found out, and the
family was able to save the house.
Mrs Charnley is the lucky one. A Manurewa couple told me they paid
out about $8000. They lost their home. A Coromandel woman told me
Home Rescue contacted her, persuaded her to sign up, and she paid
them $17,000! She now accepts that was a very stupid thing to do,
but it's too late. She is going to lose SIX homes, and will
probably be bankrupted.
"Mortgages fraudulent"
Home Rescue argue that "mortgages are fraudulent", using everything
from the Foreshore and Seabed Act to the Magna Carta. When it was
running, the Home Rescue website was full of legalese nonsense.
What they argue might have some interest for academic lawyers, but
when it comes to preventing mortgagee sales, it is complete
rubbish. It just doesn't work - I've talked to the lawyers, the
banks, the people who lost their homes. And I've seen it fail in
court.
Arguments have "no legal weight"
A couple of weeks back I got a tipoff Home Rescue would be
appearing in the High Court at Auckland. I went along, but Home
Rescue didn't. Instead, I witnessed the pathetic spectacle of a
couple trying to save their South Auckland lifestyle block, by
arguing the matter should be heard under Maori customary law. Home
Rescue didn't turn up, and they didn't file legal documents as
promised, but it would have made no difference. The judge would
have blown them out of the water. Here's a taste of what he said
about their arguments, had they been there to make them: "Hopeless
... will not be recognised ... not a defence that's going to run
... tilting at windmills ... these legal grounds have absolutely no
weight at all."
The couple will likely lose their home.
Commerce Commission warning
The Commission has been investigating Home Rescue, and in June it
sent a warning letter, saying:
- it cannot prevent mortgagee sales or foreclosures
- it risks breaching the Fair Trading Act with its claims
- its claims "may further exacerbate the vulnerable financial and
emotional position of people facing mortgagee auction"
Brendon Holmes
The bloke who has been fronting for Home Rescue is Brendon James
Holmes. He's a failed internet entrepeneur and current bankrupt. He
lives at the same address which Home Rescue lists as its base. It's
a semi rural property just north of Hamilton, and is, or was, also
the base for the United Tribes of New Zealand, a Maori sovereignty
organisation.
I'd had a couple of phone conversations with him, but he stopped
taking my calls, so eventually I went to Hamilton to try and meet
him.
He wasn't at home when I first visited, so I went back. Soon after
I arrived, so did he in a sporty Subaru. He clearly wasn't keen to
see me, because he drove across his sloping wet lawn, then sped off
up the road at considerable speed.
But as I drove away, my phone rang. It was Brendon.
He claims to have left Home Rescue, and that he was just "piggy in
the middle". Unfortunately, the many documents I have strongly
indicate that is not true.
He was dismissive when I asked where all the money went, claiming
it was for "office expenses". However, under pressure he admitted
that "it doesn't work", though he claims that is because "they" -
the legal system - refuse to pay it proper attention.
The only thing he could claim is "a hell of a lot of
stalling".
DO NOT USE HOME RESCUE
Our advice is obvious. Don't use Home Rescue. Don't pay
them any money. Don't let them put a caveat on your house. Don't
sign any of their documents. It's only going to make things worse.
It will add legal costs, it might scare off possible buyers, and
that means a lower sale price and more debt for the person who got
sold up.
Talk to your lender, and fast
Talk to your family, but most importantly talk to your lender. And
do it as early as possible. It might not seem like it, but
mortgagee sale is a last resort. Banks and lenders don't want to do
it, because it's likely to cost them money. They'd much rather have
someone who is still paying them money, and they will
negotiate.
Free, confidential, expert advice
And if you're in trouble with the mortgage, there is a great source
of free advice and help. Call the
Family Budgeting
people.
If you are in trouble paying a mortgage or even think there may be
trouble around the corner you must talk to your mortgage provider
straight away. It is best to do this before you get behind. The
bank doesn't want to take your house they want to help you find a
solution that is good for everyone.
If you need assistance you can contact a budget adviser who will
help you assess your overall situation and negotiate with creditors
on your behalf to reach a manageable plan. Call 0508 BUDGET (0508
283438) to access free, totally confidential budgeting
advice.
Police investigation
The Commerce Commission has now closed its investigation,
and handed the file to the police. We understand an investigation
is under way. Fair Go wants to hear from you if you have any
information about Home Rescue.
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