Fannie and Freddie get tough on scams
A new coalition, led by Fannie Mae and Freddie Mac, will launch a national campaign to prevent loan modification scams. The Loan Modification Scam Prevention Network also includes the Lawyer's Committee for Civil Rights Under Law and NeighborWorks America, which is a network of community development and affordable housing organizations. The network will work to educate borrowers, take in complaint reports and coordinate with local, state and federal enforcement agencies.
A story in the November 2009 issue of HousingWire cited complaints of modification scams in California increasing from 163 in 2008 to 2,000 in 2009. Some companies allegedly charged as much as $3,000 for a guaranteed loan modification and did nothing.
The network website names individuals and companies identified by enforcement agencies to have allegedly committed a loan modification scam. "This effort links homeowners to free, legitimate counseling and helps to put scammers out of business.
The goal of this campaign is to educate homeowners and empower those who have fallen victim to scammers to report and prevent future fraud," said Jeff Hayward, senior vice president at Fannie. Other partners in the network include the Treasury Department, the Department of Housing and Urban Development, the Department of Justice, Federal Bureau of Investigations, the Federal Deposit Insurance Corp. and the Federal Trade Commission.
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