Mortgage Modification Scam

Scammers Take Advantage Of Those Hardest Hit

Mortgage Scam$63 Million dollars have been reported lost by people fallen victim to mortgage modification scams in New York and California and $1 Billion dollars nationwide, according to  an article by Jim Puzzanghera of the Los Angeles Times. 

U.S. Attorney General Eric H. Holder and other officials on Tuesday said the government’s Distressed Homeowner Initiative had filed criminal charges against 530 people during the fiscal year that ended Oct. 1.

“Distressed homeowner schemes have displaced loan origination fraud as the most common type of mortgage fraud in many areas of the country,” said Kevin Perkins, the FBI’s associate deputy director.

In one case in Long Island New York, a disabled woman contacted a mortgage company seeking to refinance so that she could make improvements to her home, then sell it and move to a less expensive area. 

However, the woman unwittingly signed over the deed to the house and company drained all of her equity.

The Company had committed a foreclosure rescue scam and the woman lost her home.  The mortgage lenders have offered $20,000 to move out, but after paying off debts, that money will be all but exhausted and she will have nowhere to go.

Unfortunately, this is a common story throughout the nation.

HUD (The U.S. Department of Housing and Urban Development) is a great resource for loan modifications, and have this to offer for those who may be at risk of a scam:

Each day, scam artists posing as financial advisors and/or debt relief consultants take advantage of vulnerable homeowners whose homes have been threatened by economic difficulty. These scammers will often make promises that seem too good to be true, guaranteeing services that will either lower a monthly payment or eliminate back debt in order to save one’s home.

To stop these scammers, HUD has merged the efforts of NeighborWorks America, the Lawyers’ Committee for Civil Rights Under Law, and the Homeowners’ HOPE Hotline at 888-995-HOPE to provide an “early warning system” that empowers homeowners to protect themselves and their homes, while providing the tools necessary to take action so that law enforcement agencies across the country can put a stop to these unacceptable practices.

The first thing you may ask yourself is, “Could I really be the victim of a scam?”  To determine this, ask yourself the following two questions:

  1. Did anyone offer to help modify your mortgage, either directly or through advertising such as a flyer?
     
  2. Were you guaranteed a loan modification or asked to do to any of the following:
    • Pay a fee
    • Sign a contract
    • Sign over title to your property
    • Redirect mortgage payments
    • Stop making loan payments

If the answer to either question is Yes, then report the possible scam. Call 1-888-995-HOPE (4673)or click here to report a scam online (with your permission the complaint will be shared with federal and state enforcement agencies).

 

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