Mortgage Relief That Provides None

March 7, 2013
by
Cristina Miranda
Consumer Education Specialist, FTC

The FTC recently settled with two individuals and seven companies that allegedly lied about the mortgage relief and foreclosure rescue services they sold to distressed homeowners. These companies claimed homeowners could sue their mortgage lenders as part of a “mass joinder” lawsuit to receive more favorable loan terms, restore their credit, and avoid foreclosure on their home.

How can you avoid these types of scams?

  • Don’t believe anyone who guarantees to rescue your home from foreclosure. No matter what your situation, there is no guarantee that you will get a loan modification or help in stopping a foreclosure. The best way to find out is to call your lender directly, and quickly.
  • Don’t pay a fee up front for any mortgage relief service. It is illegal for a company to charge a fee before providing a mortgage assistance service, unless the provider is an attorney. A request for an advance payment is often a tip-off to a scam.
  • Don’t pay fees by wire transfer, especially if that’s the only form of payment a company accepts. Wiring money is the same as sending cash — once you send it, you can’t get your money back.
  • Don’t be pressured to sign any papers that you haven’t read or don’t understand. And don’t sign over the title or deed of your house to someone other than your lender. That’s a major red flag. Call your lender first.
  • Don’t believe anyone who tells you not to contact your lender, an attorney, credit or a housing counselor directly. If you are having problems paying your mortgage, immediately call your lender to discuss your options. If you are facing foreclosure, call the Homeownership Preservation Foundation at 1.888.995.HOPE to speak with a legitimate credit counselor.

If you think you’ve been the victim of mortgage or foreclosure rescue scam, file a complaint with the FTC.

Foreclosure Rescue Scams Audio Tip

Blog Topics: 
Homes & Mortgages

Comments

emtwiting1 | March 11, 2013
|

Hi, what do you know about toxic loans and FHLA LLC in Orange Park Florida

Nicole Vincent | March 14, 2013
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If you'd like the FTC to look into a company's practices, please file a complaint at ftc.gov/complaint. We use your complaints to investigate companies and bring lawsuits. We can't address complaints if they are submitted through blog comments.

biscuit1957 | March 18, 2013
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ocwen loan servicing charging fees soon will be as much as my princple

Amy | March 28, 2013
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Yes - what is being done about Ocwen? It seems that no authorities or legislators care - and yet Ocwen bought so many mortgages and so many people are being extorted. What is being done by federal or state overseers? They cared so much about the making sure the banks didn't go under, but what about American homeowners?

Susan | April 14, 2013
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Carrington Mortgage Services LLC (CMS) out of Santa Ana, CA actually trespassed onto our property (which, while the subject of a pending modification), destroyed all 3 doors with crowbars and other tools. They literally committing the crime of breaking and entering, changed the door locks and installed their locks on our pool cage doors, thereby damaging 3 doors, 2 windows and the pool cage...just for starters. Our loan is with BOA - CMS claims to be the servicer, but we don't know that and I refuse to be a victim for the 2nd time regarding my home. We did file a police report and the detectives will commence their investigation Monday. Filing complaint - this is bogus and downright a violation of our rights and I will continue to file complaints, write letters and run my big mouth until this company is held accountable, both financially and otherwise for their crimes.

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