For many of us, our home represents our most valuable asset and we protect it for our families by keeping it repaired and making improvements. Generally, over time, our home equity increases. But the value can vanish immediately when dishonest businesses talk homeowners into home equity loans or debt consolidation which can leave unsuspecting consumers with loans they can’t afford.

This con is widespread and growing. New York homeowners testified last year before the Assembly’s Committee on Banks telling their horror stories. In one, a family lost their house because of unscrupulous financiers who sold it out from under them. In another, a mother and her two children were evicted by signing over their house to a deed-theft scammer. These crooks shatter dreams, leaving people destitute and with little or no recourse.

Schemers know your home’s value and how to turn it into their profit. They prey on the elderly, the poor, minorities and those who have a tough time making ends meet. Some promise to save you from foreclosure, by lending you money. But instead of signing loan papers, you discover you’ve transferred your title for the price of the loan. The thief has your home and you’re out the door.

Others sell home improvements and offer financing at a high cost, leaving you broke and with incomplete repairs. In some cases, the loan papers you sign, sign over your house.

Contractors can also recommend high-price mortgage companies for loans. They get the loan proceeds, and you get a high-interest mortgage loan. Lenders then offer to refinance or flip the loan for better rates. But in truth, the refinancing puts you further in debt.

Debt consolidation is another trick. A lender bundles your debt in a single mortgage loan, pressuring you to borrow more money than you need. You end up owing more and, if you default, may lose your house in the bargain.

The climate for fraud must end. That’s why I joined the Assembly to unanimously pass legislation that puts in place a series of measures that safeguard the consumer against home equity theft. AARP has also pushed for reform to stop this type of predatory lending, testifying nationally on the problem and before the Assembly’s Committee on Banks. The Assembly’s Home Equity Theft Prevention Act (A.10057-A) penalizes those who intentionally mislead homeowners with financial schemes involving oral and written misrepresentations, deceit, intimidation and other abusive practices.

Our bill requires all contracts between the equity purchaser and the equity seller to be in writing in the primary language of the seller, it gives the seller the ability to cancel or rescind a contract, it prohibits misleading statements and pressure tactics, and it mandates fines and prison in order to help curb this increasingly pervasive crime.

This bill strengthens previous legislation, building on a 2002 law the Assembly passed which protects homeowners from unscrupulous mortgage lenders who target borrowers with high-interest loans and a high likelihood of default, and seek easy gains from foreclosures.

By signing the Assembly’s current measure into law, we will take another important step to help eliminate this fraud and stop thieves from stealing our homes.