Loan Modification Scams are a Danger
Home foreclosures continue across the country in the wake of the Great Recession. This has led to scam artists who take advantage of a family’s fear of losing their home. 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. Fees are requested in advance, yet little or no service is ever provided and victims ultimately lose money and may lose their homes.
That is why MEDA has teamed up with the U.S. Department of Housing & Urban Development (HUD)–and its alliance of local, state and national partner organizations–to stop such disreputable scammers. MEDA is taking part in a nationwide education campaign that brings scammers’ methods to light and empowers homeowners.
Six red flags: pay attention to these signs
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. Legitimate, trustworthy HUD-approved counseling agencies will promise only 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 do not fully understand. A legitimate housing counselor would never pressure you to sign a document.
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, as. These professionals can tell you whether you qualify for any government programs to prevent foreclosure. 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 give this type of information only to companies that you know and trust, such as your mortgage lender or a HUD-approved counseling agency.
Fight back and report loan modification scams
You can fight back! Help put a stop to loan modification scams. If you, or someone you know, have been the victim of a loan modification scam, we urge you to make a quick call and report these scam artists to the authorities.
If you are interested in loan modification scam alert information, please call (888) 995-HOPE (4673); or click here for more details.
Foreclosure intervention & default counseling
Are you in the process of or at risk of losing your home to foreclosure? MEDA offers solutions with its Foreclosure Intervention & Default Counseling program. Our expert staff can help you identify the best solution for your situation. MEDA is 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.
If you are interested in free foreclosure workshops, please contact : (415) 282-3334 ext. 126; firstname.lastname@example.org.