Several organizations, including nonprofit and government agencies are working together to warn consumers of the danger of these scams.
Here are some examples of the common mortgage relief scams.
Scammers posing as official counselors. These con artist claim to be connected with the homeowners’ lenders. They usually demand an upfront fee for their services. Many scammers use similar names to nonprofit and government programs and even their logos to their materials.
To avoid being a victim of one of these scams, owners should find a legitimate, free HUD approved housing counselor by going to HUD.gov.
Offering to perform a mortgage audit. The Federal Trade Commission (FTC) says the scam involves a salesperson will call the homeowner and say they are going to audit their mortgage documents and use the violations they find to force their lender to approve a load modification. The scammers would tell people that they found violations 90% of the time.
Again, consumers can avoid this scam by contacting a local HUD approved counselor through the HUD website.
Money-back guarantees. These scammers tell people they can guarantee a loan modification or guarantee that they can stop a foreclosure, but unfortunately a guarantee is never possible.
Homeowners should never pay a fee for loan modification assistance. Nonprofit and government housing counselors provide this service for free.
Advising you to stop contacting your lender. These scammers will tell you to stop contacting your lender. They will tell the homeowner that they can get a better deal. Do not trust someone who says they will talk to your lender on your behalf.
Misrepresenting attorneys general settlement. According to foxbusiness.com, “These attorneys general settlement with the five largest mortgage lenders brought out a new group of people who call homeowners and tell them they represent the lender.” They will also request $500 or more to help the homeowners get money from the settlement.
To avoid this scam, never give out your personal financial information to anyone who calls you.
Mass joinder scam. Fake and even legitimate law firms send notices to homeowners that claim the homeowners have been wronged by their lenders and may eligible for restitution.
Never pay a fee to become part of a class action-lawsuit.
If you have been a victim of a scam, contact the Better Business Bureau (BBB) or the Federal Trade Commission (FTC).
Officer Larry Jacobs is the Crime Prevention Officer for the Sandy Springs Police Department. He can be reached directly at email@example.com.