Watch out for loan modification scams, the California State Department of Real Estate (DRE) is warning customers. The DRE has filed a record number of actions against scammers who have offered loan modification and loan mortgage relief services.
Since 2008, the DRE has opened more than 4,500 cases that involve loan modification complaints, as well as 88 accusations accusing 159 real estate professionals of violating real estate laws in connection with offering loan modification services.
One popular loan scam: The assurance of a loan modification in exchange for an upfront fee. Once the fee is paid, the scammer does little or nothing to obtain a loan modification.
"With so many home owners facing financial hardship, foreclosure rescue and loan modification scams are very prevalent and consumers need to be on guard," says DRE Commissioner Jeff Davi. "We have seen many variations of scams, but most all involve the collection of illegal advance fees. If someone asks for money upfront, that is a huge red flag.”
The DRE is telling customers to avoid becoming a victim of a scam by never paying an upfront fee for loan modification services and being skeptical of promises of “guaranteed success.” They are encouraging home owners to contact a HUD approved counseling agency, which can provide loan modification services for free (http://www.yourhome.ca.gov/mortgage-help.shtml#scams)
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