Mortgage Relief That Provides None
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.