Loan Modification Scam Alert


Loan Mortgage Modifications Scams are a Danger to Bay Area Residents

Home foreclosures across the country are at an all-time high. In the Bay Area alone, 13,417 homeowners gave notice of default between January 2011 and March 2011. It seems many of us know someone – a friend, neighbor or relative – who is afraid of losing their home.

The biggest risk to homeowners are scam artists who take advantage of their fear of losing their home and as a result loan modification scams are on the rise. These scam artists prey on homeowners who are facing foreclosure; contacting them by phone, mail, online or even in person. They often seem legitimate and make big promises to modify loans and guarantee that they will save a home from foreclosure. They take fees in advance yet provide little or no service. Victims ultimately lose money and may lose their homes.

That is why MEDA is teaming up with the U.S. Department of Housing & Urban Development (HUD) and its alliance of local, state and national partner organizations to stop the scammers. We’re taking part in a nationwide education campaign that brings scammers’ methods to light and empowers homeowners

The Top Red Flags to Look For

  1. A company/person asks for a fee in advance to work with your lender to modify, refinance or reinstate your mortgage. They may pocket your money and do little or nothing to help you save your home from foreclosure.
  2. A company/person guarantees they can stop a foreclosure or get your loan modified. Nobody can make this guarantee to stop foreclosure or modify your loan. Legitimate, trustworthy HUD-approved counseling agencies will only promise they will try their very best to help you.
  3. A company/person advises you to stop paying your mortgage company and pay them instead. Despite what a scammer will tell you, you should never send a mortgage payment to anyone other than your mortgage lender. The minute you have trouble making your monthly payment, contact your mortgage lender.
  4. A company pressures you to sign over the deed to your home or sign any paperwork that you haven’t had a chance to read, and you don’t fully understand. A legitimate housing counselor would never pressure you to sign a document before you had a chance to read and understand it.
  5. A company claims to offer “government-approved” or “official government” loan modifications. They may be scam artists posing as legitimate organizations approved by, or affiliated with, the government. Contact your mortgage lender first. Your lender can tell you whether you qualify for any government programs to prevent foreclosure. And, remember, you do not have to pay to benefit from government-backed loan modification programs.
  6. A company/person you don’t know asks you to release personal financial information online or over the phone. You should only give this type of information to companies that you know and trust, like your mortgage lender or a HUD-approved counseling agency.


Fight Back & Report Loan Modification Scams

You can fight back and put a stop to loan modification scams. If you or someone you know has been the victim of a loan modification scam, we urge you to make a quick call and report these scam artists to the authorities.

To learn more call: 1-888-995-HOPE (4673) or click here for more details.

MEDA Offers Foreclosure Intervention Counseling

Are you in the process of, or at risk of losing your home to foreclosure? MEDA is here to help you identify the best solution for your situation. We are a HUD Bay Area approved counseling agency. We can help you develop a household budget and debt reduction plan, prepare and submit a loan modification package, learn what to expect in the foreclosure process, and protect yourself from mortgage modification scams. Contact us today for assistance.

Contact:  Diana Mayorga at 415-282-3334 ext. 132 or dmayorga@medasf.org

 

Learn more about the Mortage Loan Modification Campaign: click here