State officials warned struggling homeowners about a new variation on loan-modification scams: “forensic loan audits.”
Loan Modification Scams
Under the dubious service, homeowners are enticed to pay upfront fees for an audit of their mortgage loan, purportedly to determine their lender’s compliance with state and federal laws. It’s pitched as a way homeowners gain leverage in the loan-modification process.
HUD (Department of Housing and Urban Development) has launched a new online resource to fight loan modification scams. Preventloanscams.orgThe Network developed PreventLoanScams.org to provide homeowners with a single destination to report alleged scammers. Complaints filed online are added to a national complaint database and forwarded to the appropriate law enforcement agencies for review. The Network estimates that the website will assist approximately 50,000 homeowners affected by scams. Additionally, HUD has directed its local fair housing and housing counseling grantees to begin reporting alleged loan modification scams via the website.
If you would like a copy of the Federal Reserve booklet on avoiding foreclosure scams, call or email us.
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Tags: foreclosure scams, Help for Homeowners, help for homeowners in trouble, stop foreclosure
This is old news, Mortgage Fraud Examiners exposed this problem a year ago in a press release: “Beware Of The Latest Foreclosure Rescue Scam–Loan Audits”
You’re right, but it’s reared its ugly head again in SoCal. The government thought it important enough to post on their foreclosure prevention website.
There is obviously so much more to read about this. I think you made some great points in Features also. Keep working ,great job!
Thanks, a struggling homeowner is a “ripe” target for these scam artists.
My note holder is Chase. Anyone know how they are in regards to servicing loan modifications?
You can look for Chase to follow the Wells Fargo/Wachovia lead to streamline both the loan modification and approved short sale process. Chase like all the other major lenders has way too many toxic assets to continue to hold them on their books at inflated values.
Can you provide more information on this? take care
The homeowner will receive an offer to have their loan documents “forensically” audited to determine if there are any mistakes that could release the homeowner from repaying the loan or at least stop the foreclosure process. The fee is required up front and the “auditors”, unless they are attorneys aren’t qualified to perform such an audit.