Thousands of Americans Have Already Fallen Victim to Loan Modification Scams

A number of loan modification scams have been popping up all over the country as more and more homeowners seek loan modification assistance. There are simply too many people looking for assistance with their mortgage for non-profit counseling agencies to handle, and many homeowners are put on a waiting list at a time when they don't have time to be waiting. Most homeowners seeking home loan modification are on the verge of foreclosure and many will try about anything to stay in their homes.

Since homeowners can't get assistance they can trust, some of them turn to less optimal agencies to handle their loan modification. While there are legitimate subprime loan modification lenders out there, there are an equal amount of scamming firms in every state. Most loan modification scams as for an upfront fee for either the consultation or to even start a loan modification plan. There have even been workshops set up by these same companies that charge an outrageous amount of money to a homeowner that guarantee they will be free of their mortgage problems. These are fraudulent and every homeowner needs to be aware of the loan modification scams out there.

Some loan modification scams do only half of the work, while others don't do any at all. Their goal is to get the initial fee from the homeowner and to either leave them high and dry, or to drag it out and ask for another fee at a later date for "another step in the process."

The count of Americans who have fallen for these loan modification reaches into the thousands, and the FBI is looking into companies reported to be committing these frauds. A homeowner looking into loan modification needs to check with the Better Business Bureau before allowing a company they are not familiar with handle their loan modification at all. A simple check with the Better Business Bureau can be the last line of defense for a desperate homeowner to keep their home.

During financial hardship, homeowners will do anything to help keep them and their families stay safe and comfortable in their homes. Thousands of homeowners turn to the wrong people expecting loan modification assistance and instead end up even worse than they started out. As with any aspect of the home loan modification process, staying informed can save a lot of headache later on. From the search for a non-profit counseling service, gathering the paperwork needed, to approaching the lenders, keeping informed of your financial status and how the loan modification assistance process works can save homeowners in the long run. Loan modification scams can ruin lives and leave families in ruins, but simple knowledge can keep thousands of families from falling into situation they cannot get out of.

Emma Lanier, "Home Loan Modifications Myths", Mortgage Lending Modifications