Yesterday, the Obama Administration announced an initiative to fight loan modification scams that are preying on troubled homeowners searching for help.
As foreclosures continue to mount, opportunistic companies with official-sounding names have taken root across the U.S., making false claims that they can assist borrowers facing foreclosure. Many of these companies are charging distressed homeowners with fees of $1,000 to $3,000 for loan modification help that rarely pays off.
In addition, the Federal Trade Commission (FTC) recently discovered approximately 71 companies running suspicious home rescue plans. The FTC has already filed new cases against several of these companies to halt illegal practices of individuals and companies promoting loan-modification or foreclosure scams.
Consumers who are seeking to modify home loans can speak to a counselor for free through the government’s “Making Home Affordable” program. For more information about that program, please visit www.MakingHomeAffordable.gov.