Whenever the real estate market takes a turn, for better or worse, cottage industries seem to pop up. In the current downturn it's all about the loan modification. My personal belief is most of these companies are bottom feeders and taking advantage of people who are already in dire straights. Add in the fact that loan modification rarely works, and that homeowners can do the work themselves, and well it's not hard to see why real estate professionals are at the bottom of the food chain when it comes to popularity.
There are several ways homeowners in California can protect themselves. First, do your homework BEFORE paying anyone upfront fees. Several resources exist online where you can read up on the current market. The California Department of Real Estate (DRE) web site is a great place to learn about all things real estate. The DRE even issued a Fraud Warning in March, 2009 about loan modification scams. To view that warning and other resources visit the DRE nia Department of Real Estate's (DRE) web site at:
Here you can check the license status of real estate professionals, visit other resources such as the FHA and Hope Alliance sites, and even see the latest information on Advance Fee Agreements. In California a real estate broker must have an Advance Fee Agreement that clearly spells out what the broker will do for you. They must also have a letter filed with the DRE stating they are performing loan modification services for an upfront fee. They even have a list of brokers who have filed such a letter for your review. Please note the following is prominently displayed on the DRE site: The Department of Real Estate does not approve, endorse, recommend or make any representations about any of the agreements or their terms, or any aspect of a licensee's business activities. Consumers wishing to contract with a real estate broker for loan modification or any other similar or related services should carefully review the agreement(s) and consider obtaining independent advice before signing an agreement(s) or advancing any fees. Consumers should also consider comparing the services and fees offered by other licensed brokers on the list.
The bottomline is you have resources to tap into if you feel you have been taken advantage of. Use them! Educate and protect yourself on current trends and issues that can have huge consequences for you and your family.