The current mortgage and housing crisis has resulted in an increased demand for loan modifications. To meet this demand, new loan modification companies and services are cropping up everywhere. While some of these services and companies are legitimate and may be able to help you with your loan modification, others are not. There are scam artists out there looking to take advantage of struggling homeowners who are in fear of losing their homes. They offer big promises and guarantees but are only there to take your money. Other companies may not be out to scam you, but they really don't have the sufficient experience to effectively help you. So how do you tell if a loan modification company is legitimate or not? Here are 4 tips to help you.
First you should check to see if the loan modification company has any association with any lenders or banks who offer loan modifications. In particular, it will be helpful if the loan modification company has an association with your particular lender since they will be working on your behalf to help negotiate a loan modification for you. If a loan modification does not have relationships or experience working with lenders then you should not work with them.
Next you need to research the company's experience and qualifications. You will want to know if they have experience with loan modifications. Ask for references. Also find out what the employees educational and professional backgrounds are. If the company cannot provide references or point to their experience and background with loan modifications, you should avoid them at all costs.
Third, the company you are considering working with should have a physical address and you should check to see whether or not the company has the proper licenses required in your state for loan modifications.
Fourth, look out for any company who is offering guarantees or big promises. No legitimate loan modification service will offer you a guarantee that your loan modification request will be approved. A loan modification will depend on whether you meet the lender's eligibility requirements and the final decision rests with your lender. Also be very wary of companies who require large upfront payments.
There are some legitimate loan modification companies and services out there that may be able to help you, but you must do your upfront research to make sure they are legitimate. Another option available to you is to spend that time learning about the loan modification process and dealing with your lender directly to request a loan modification.