A few tips to make sure you do not fall victim to loan modification scam;
- Check the California Department of Real Estate website to see if a "Desist and Refrain Order" has been filed against a company you are considering working with.
- 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.