It's every homeowner's fantasy: to own their home free and clear. There are lots of legitimate ways to pay off your mortgage loan faster, but here's the latest scam for folks hoping to eliminate their entire 30-year mortgage--in less than a year.

Here's how it works. A "mortgage elimination" company posts ads in magazines, on the Web, in newspapers, or anywhere else they can find victims, promising that their system is legal and effective.

One of the strangest arguments, though persuasive to potential victims, is that lenders don't really lend money. Although it's a convoluted argument, the bottom line is that lenders borrow money from other lenders, and when the lending chain is followed all the way to its source, it turns out to be the federal government, which prints money on ink and paper, meaning that the money has no real value. Since that's the case, it was really the victim who generated the money the first place. If the victim buys that argument, it means their mortgage note is meaningless and no money is actually owed.

Conspiracy enthusiasts love that sort of talk, especially if it's back up by hints that agencies such as the FBI don't want us to know about the true lending process, because they're afraid that when the American public finds out, the banking industry will no longer be able to cheat innocent homebuyers out of their hard-earned cash.

The next step is for the homeowner to send a check for several thousand dollars, on the mortgage eliminator's promise to guide them through the process and to represent them in court, if necessary. After that, one of two things will happen. Some mortgage eliminators will simply disappear, and the victim will never hear from them again. Others will actually deliver a program, which inevitably will lead to the homeowner's loss of their home through foreclosure.

Here's how that second option works. The mortgage eliminator tells the homeowner to go to the county clerk's office and file a discharge of debt form, stating that the mortgage is paid in full. That's not the case, of course, but when clerk records the form, it does appear as if the property is owned free and clear. Next comes the part where scam artists really clean up. With the property seemingly free and clear, the homeowner can now apply for more loans, and the proceeds are then split, with the mortgage eliminator often getting the larger portion. Everything seems fine--until the county clerk and original lender discover the scam and confront the homeowner, who is soon caught up in a huge legal and financial bind, as well as facing possible fraud and conspiracy charges and jail time.

The saddest part of this scam is that the most vulnerable people are those who are already facing bankruptcy or foreclosure. Everyone dreams of owning their home free and clear--but when it comes to paying off your mortgage, remember the old adage: if it seems to good to be true, it probably is.

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