Thursday, September 10, 2009

Loan Modification Scams - Don't fall for these!

I got a call from a very nice lady this afternoon who lives a few doors down from one of my short sale listings. She wanted to know if the house was pending sale or was sold, and for how much, so she could get an idea of what her house is worth.

Since the sale was not yet complete, I could not provide her with all of those details. I asked her if she herself was thinking about selling, and she explained that she had just lost her job and was unable to afford her mortgage payment...but mentioned she had planned to pay $1,900 to a loan modification company in Southern CA that promised to get her mortgage company to reduce her principle loan balance to the current lower market value - hence her call to me to inquire about the selling price of my listing as a reference point.


Alarm bells went off in my head. I grabbed my laptop, which coincidentally always seems pretty close by, and pulled up the CA Department of Real Estate website. I asked the lady the name of the company, and cross referenced the list of "Desist and Refrain Orders and/or Accusations for Fraudulent Loan Modification Activities." Sure enough, the company she had planned to work with was on the list. OH GAWD!!

I immediately explained to her why hiring this company was a bad idea. While there are some legitimate profit-based loan modification companies out there, many companies that promise to modify your mortgage loan will take the up-front fee and RUN. That's right - they will deposit that check, or even worse, run your credit card, and you may never hear from them again. DO NOT LET THIS HAPPEN TO YOU!

Did you know that the Home Loan Counseling Center of Sacramento offers free Foreclosure Prevention Counseling??? Did you know they offer counseling in English, Spanish, and Russian? At the HLCC, you can meet with a certified Foreclosure Prevention Counselor who can explain options available to you, help you develop a household spending plan and negotiate a modification with your lender on your behalf. Services are free and confidential.

If you are attempting a loan modification and need help - please, try the HLCC first! If you are not successful in your loan modification and want to do a short sale, then call me and I can assist you there...

1 comment:

Loan Modification said...

I agree with your blog post. Thanks also for sharing your ideas and insights. With our economic status today, a loan modification may be the only way for a homeowner to save their home. But most banks that are big doesn't reply with loan modification inquiries fast because they don't care if they lose some loans to foreclosure.