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Erin Stumpf's Real Estate Blog

Sacramento Real Estate and other items of local interest

By Erin Stumpf | Broker in Sacramento, CA

California Department of Real Estate issues a Consumer Alert - AVOID Loan Modification Scams!

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.
A HUD approved counseling agency can provide loan modification or other mortgage negotiation services for free. There are many of them in Sacramento.


By Gena Riede,  Tue Mar 22 2011, 17:25
It is amazing how many of our Sacramento area homeowners are still falling victim to these predators. Seems like there is another new scam every time I turn my head.

I hope homeowners read this and share it with their friends, family and neighbors. Good job, Erin.

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