The housing market took a tremendous hit when the recession affected the economy. As Florida families struggled to keep their heads above water, many turned to loan modification as a means of keeping their homes. However, if you have watched the news lately, you may have heard there are many loan modification scams out there, and homeowners who need help are the target of these scams. Despite how sophisticated these scams may be, there are tips to help homeowners avoid getting caught up in a loan modification scam.
One way to tell if a loan modification company or promise may be a scam is how they got a hold of you. If they directly contacted you or advertised through a flyer, chances are they may not be a legitimate service. Another tip is if you were asked to pay a fee. A real loan modification service will not have you pay a fee upfront for services.
If a loan modification service has asked you to sign over the title to your home, don’t do it. Furthermore, it would be best to not do any more business with this group. A loan modification service also should not ask you to stop making payments while the loan modification process takes place.
Loan modification has helped many Florida families keep their homes and get the lower payments they need so that they can begin to recover from the recession. There are very strict regulations for loan modifications, and knowing what is legal and what isn’t can help you avoid scams. While scammers have been made to pay restitution in some cases, many other Florida homeowners were not paid restitution and had to suffer the consequences of being the victim of a costly scam. In many cases, filing for bankruptcy has helped Florida residents recover from financial hardship.
Source: portal.hud.gov, “Stop Loan Modification Scams!“, Aug. 4, 2014