The U.S. Department of Housing and Urban Development (HUD) issued a press release announcing its partnership with the Loan Modification Scam Prevention Network in launching the www.PreventLoanScams.org website and national scam complaint form. It is a "a major step in the fight against loan modification scammers,"
“Homeowners at risk of foreclosure can be easy prey for home loan modification scammers. Often, dishonest individuals lure vulnerable homeowners into foreclosure rescue scams by making false promises. Scammers frequently claim they can lower mortgage payments or stop the foreclosure process.”
“Troubled homeowners lose time and money when they are tricked by con artists who promise to help but never do,” said John Trasviña, HUD Assistant Secretary for Fair Housing and Equal Opportunity. “This initiative combines the collective energies of public and private enterprises to strengthen the ability of law enforcement to prosecute scammers and protect homeowners.”
The 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.
The creation of a national complaint database is a major step in the fight against loan modification scams. Prior to the launch of PreventLoanScams.org, federal, state, and local government agencies could not share complaint data with non-profit organizations. The new system allows for better analysis of trends across jurisdictional lines and will likely lead to an increase in private enforcement action filings.
Tips to Avoid Being Scammed
1. Beware of anyone who asks you to pay a fee in exchange for a counseling service or modification of a delinquent loan.
2. Scam artists often target homeowners who are struggling to meet their mortgage commitment or anxious to sell their homes. Recognize and avoid common scams.
3. Beware of people who pressure you to sign papers immediately, or who try to convince you that they can “save” your home if you sign or transfer over the deed to your house.
4. Do not sign over the deed to your property to any organization or individual unless you are working directly with your mortgage company to forgive your debt.
5. Never make a mortgage payment to anyone other than your mortgage company without their approval.
HUD is a key partner in the fight against loan modification scammers. They have taken numerous steps to publicize the Loan Modification Scam Prevention Network's online complaint form, including contacting over 2,400 of their certified housing counselors requesting that they use utilize it to report scams while working with homeowners.
We must be vigilant against fraud, recognizing its signs and taking proactive, definite, and realistic steps to not only prevent it but also punish it.
It starts with me.
It starts with you.
It starts with us…
You are all encouraged to report any suspected mortgage fraud activity to authorities, www.PreventLoanScams.org
Michael S. Richardson
Director/Mortgage Fraud Services
Author of "An American Epidemic, Mortgage Fraud a Serious Business"
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