Yesterday the California Department of Real Estate
issued a new Consumer Alert
to give homeowners tips to avoid Loan Modification and "Mortgage Relief" scams
. I receive several calls per month from homeowners who feel that they are victims of these scams
, and I can not offer much help except to direct them to report the scam to the Better Business Bureau
, the California Department of Real Estate
or their local law enforcement
A few tips to make sure you do not fall victim to loan modification scam
- Don't believe promises that are too good to be true. No one can guarantee that a "mortgage relief" plan will be be successful.
- NEVER pay an upfront fee for loan modification services. Such fees are illegal in California. Advance fees for short sale services, deed-in-lieu of foreclosure
and other residential mortgage foreclosure rescue services are also
illegal under a new federal rule, with a very limited exception for fees
paid to lawyers.
- Check with the Better Business Bureau, and verify the existence of appropriate licensing for anyone offering those services.
- Google the company name to see if you can find any red flags.
HUD approved counseling agency
can provide loan modification or
other mortgage negotiation services for free. There are many of them in