Many homeowners feel stretched to pay their mortgage or are have fallen behind on their payments. Scammers, often calling themselves “foreclosure consultants” or “foreclosure relief companies,” take advantage of people who are experiencing this very common problem.
How can you tell if an offer of help is legitimate? Beware of:
- Anyone who guarantees a mortgage modification. There are no guarantees. Your success in finding a solution to make your mortgage affordable will depend on many things, including how soon you seek help; your income; and the reasons you’re having trouble making payments.
- Anyone who charges an up-front fee to help you. Trustworthy, professional assistance is available free through HUD-approved non-profit organizations that abide by rules that keep your information secure and assure you of the best assistance possible. A “consultant” or “counselor” who charges a fee up front may not actually provide any of the promised services, and may actually disappear or become unavailable once you’ve paid the fee.
- “Attorney backed” programs. According to the Minnesota Attorney General’s office, “These companies may tell homeowners that they are exempt from Minnesota’s law prohibiting up-front fees because they use attorneys and that homeowners will receive better service because they are working with attorneys.” In reality, these companies use lawyers who are not authorized to practice in the state of Minnesota, and typically require extremely high fees for “services” that give the homeowner no positive results.
- Phone calls that seem to be from your bank. Some scam artists may try to give the impression of being representatives of your mortgage servicer. Of course, it’s possible that your bank actually might call you on the phone, but remember that a real representative of your bank shouldn’t need to ask you for personal information (they already have it!) If you’re in doubt about the identity of a caller or the legitimacy of an offer, end the call, and call a number that you know belongs to your bank to investigate.
This list of tips draws from information provided by the office Minnesota Attorney General. See the Attorney General’s website for more details on these and many other tips related to mortgage scams.
If in doubt, contact an advisor at PRG or another HUD-approved organization. Our assistance is confidential and free of charge.