Types of Loan Modification Scams

What is a scam?

Dictionaries describe scams as follows, according to http://www.thefreedictionary.com/scam.

n. A fraudulent business scheme; a swindle.

tr.v. To defraud; swindle.

How you know if you have been scammed by a loan modification company

The first type of loan modification scam involves the said company taking your money and not never communicating with you again.  The scammer makes a false front as a legitimate company and leaves the area after they collected a large sum of money from their victims.

The second type of loan modification scam involves companies who collect a fee from you (the client) and does not refund the money in the event the loan has not been modified successfully.

It is important to make sure you are engaging in a transaction with a reputable company.  ModFraud.org can help you:

• Work with an attorney to get your money back from a scam.
• Find a pre-screened loan modification company

Things to Know Before You Pay for Loan Modification Services

In the middle of the housing and credit crisis, loan modification has become an option for homeowners to get some relief.

Unfortunately, there are a lot of fraudulent companies that are taking advantage of consumers.  Here are some tips that can help to choose the right loan modification company.

1. Better Business Bureau
   This is always a good place to start. Visit www.bbb.org and find out what you can about your potential loan modification company.
2. Consumer Compliants
   Visit our government links to see if any reports have been filed against that company.
3. Use a Pre-screened Company
   Speak with a ModFraud.org representative to find a pre-screened loan modification company in your area.

As always, knowledge is power! Educate yourself before making a decision to send a company your money.

Loan Modification the New Subprime?

Loan modification companies are coming to market as fast as sub-prime mortgage brokers entered the market during the “Refi Boom”.  And unfortunately, the mess they may leave behind could be just as bad.

It is important to work with a loan modification company that can actually help.  Most customers are approached by brokers or middlemen that try to work with the bank on your behalf.  Worse yet, sometimes they do nothing at all.

Working directly with an attorney or legal office is the only way to be correctly represented.