Avoiding Foreclosure Mitigation and Counseling Scams
Glenside, PA - June 25, 2009 - (RealEstateRama) - As the mortgage foreclosure crisis escalates, the scammers have found a lucrative new business: helping people avoid foreclosure, for a price. Consumers should beware of potential scams on two fronts: unlicensed mortgage modification companies and for-profit mortgage counseling agencies.
On the one hand are mortgage modification companies which offer to help struggling homeowners lower their mortgage payments, for a fee. While some of these companies may be legitimate, others are scams intended to prey upon families desperate to save their homes from foreclosure.
The Pennsylvania Department of Banking recently ordered six out-of-state mortgage modification companies to end their unlicensed business activities in Pennsylvania. The companies advertise on their web sites to refinance mortgages in Pennsylvania as part of the loan modification process when they are not licensed to do so.
The cease and desist orders apply to:
- ApplyLoanMod.com, California
- ClearHomeRelief, California
- HomeForeclosureFighter, California
- U.S. Loan Assistance Center, California
- Mortgage Solutions Clearing House, Florida
- American Foreclosure Specialists, Oklahoma
The second common scam is charging for mortgage counseling services, which are available for free from any number government-approved non-profits. People who are having trouble paying their mortgage should not pay any fees for a service that is available for free.
The web site FindaForeclosureCounselor.org lists all the nonprofits providing free services that are affiliated with the federal government’s National Foreclosure Mitigation Counseling (NFMC) Program, and provides a comprehensive, pre-screened source for referrals across the country. NFMC is the federal government’s massive collaboration with NeighborWorks, to fund certified foreclosure prevention counseling nationwide.
The Department of Banking reminds homeowners that they can also find certified housing counseling agencies by contacting the Pennsylvania Housing Finance Agency at 1-800-822-1174 or www.phfa.org.
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