How to Avoid Loan Modification Scams

By
Mortgage and Lending with Loan Modification
http://activerain.com/droplet/TvR

How to avoid Loan Modification scams 

 

This is the biggest dilemma a homeowner is faced with when looking for help to avoid foreclosure. Who to choose, where to start and who is legit? It's not a secret that nearly 75% of Loan modification companies are fraudulent or scam artists.

Loan modifications are in high demand right now. This makes it easy for scammers to pray on innocent people who usually will end up victims. Many lose their homes and the fee they invested for mitigation services. What's worse is, many homeowners entrust their last dime to an outside source who is supposed to help them.

This is why it is important homeowners take the necessary steps to ensure they have hired a trusted Attorney to deliver favorable results. This will also improve the state of our economy, because more people will be able to remain in their homes.

These said Loan modification companies often attempt to scam borrowers by accepting money or fees for loan modification services and then rejecting any type of loan modification that is plausible for the borrower,  or imply minimal work on a file and do not implement negotiating tactics. Meaning they will get a package together for you, submit it to the lender, and accepts whatever the lender  which will end up in less favorable results for the homeowner. 

The best way to avoid Loan modification scams is to Retain an Attorney. Licensed Attorneys have a threatening presence in front of the lender and experienced in analysis and arbitration necessary to reach a fair agreement. You also are protected with the Attorney/Client Privilege which means everything is confidential.

 

Scroll down for tips on How to Avid Loan Modification scams, or keep reading if you would like help locating an affordable, established Attorney or Law Firm that can assist you in your area.

 

I have done extensive research, reviewed contracts, and asked imperative questions with many Attorneys. Based on my research, I have found a few affordable, honest Attorneys, and I am now directing distressed homeowners to them while participating during the process. 

I have complied a handful of Attorneys and Law Firms who:

1. Are  in good standing with the Bar Association
2. Are actual licensed attorneys who will be representing you and negotiating for you.
3. Have proof of success
4. Have passed my legitimacy test (scam free, and researched thoroughly through reliable resources.)
5. Have reasonable fees
6. Have the clients best interest in mind
7. Are structured and organized
8. Are in compliance with federal regulations and guidelines
9. Are helping homeowners in the State you reside in

10. Offer a Money Back Guarantee

 

******Tips on How to Avoid Loan Modification Scams. This is what I found during my research:******


Tell tale signs of a Loss Mitigation Scam:

  • Charges a huge upfront fee :

 Do not pay an upfront fee to anyone who is not a Licenced Attorney or Law Firm. There are some Loan Modification companies who will charge sometimes up to $7500 with out even reviewing your file upfront. This is an automatic Red Flag! These are what I refer to as Fee Chasers. In most cases you are promised the world "verbally" and a stage of urgency is set to scare you into paying them immediately.

  • Collects upfront fee with out explaining the process, or does not seem interested in your circumstances .

Anyone legit will listen and care about what your going through, and will explain exactly what you are paying for and what to look forward to while on the program. There should be no unanswered questions. Listen to your intuition! It is screaming at you!

  • Does not stop the foreclosure legally

    If your home is in foreclosure and you hire a company who is supposed to be negotiating on your behalf, what if the lender takes a long time to respond? Your may lose your home. There is no real sign to look out for on this one other than reading over your contract thoroughly to observe what services you will be paying for. Remember: Verbal promises are obsolete.

    • Will accept the first proposal from the lender 

    You pay an upfront fee for a Loan Mod, and with in 90 days your bank comes back with a modification that does not suit you or your budget. or worse had not even been contacted. Now you find yourself 3 more months past due and probably a lot closer to foreclosure. A lot of times homeowners are forced into accepting terms that are not beneficial in order to keep their home, just to find themselves right back in the same situation a few months later. Problem is, you only are allowed one modification per year as it stands now. If you choose carefully and are working with an Attorney your loan mod should turn out significantly better, which obviously results in long term benefits.

    • Virtual Company:

    These days the Internet has so much power you could literally have your business online without a physical location. Any Attorney you hire should have a verifiable physical address and stated as a Firm. Make sure to check the Bar Association too. They will know of any complaints that have been filed. Unlike the BBB, you can't pay the Bar Association for a good rating.

    • Did someone promise you certain terms or rates for your loan modification?

     This may be your biggest tip. Huge Red Flag! If you are being promised an interest rate, or an exact principle reduction amount, most likely you are just being told what you want to hear. Please note that no one can promise you anything without negotiating with your lender. This is extremely important. Legally you have no leg to stand on in court if anything was verbally promised to you because there is no way for you to prove it. Challenge them and ask them to provide what they are verbally telling you in writing. I can tell you this. It won't happen.

    • Is there an approval process?

    Before you agree to paying any fee at all, there should be an application process which would determine if you qualify for this assistance. This should not include credit qualifying. Credit is not a determining factor. The application should include, your budget, income, property info, and hardship, basically an entire package should be submitted and reviewed before the loan mod company or Attorney decides to take on your case. Your approval should not be determined on the first phone call.

    • Can not find them on the BBB, or anywhere else for that matter.

    Most companies who have been in business for at least a year will have a rating with the better business bureau whether they are a member or not. But the BBB is over -rated so take heed and don't stop there when doing your research.  The best place to research an Attorney's background is with the Bar Association. You want to make sure you are working with a leader in the industry. Extensive research can help you establish this. 

    On the other hand, there are some legit companies who do what they say they will do. if you can affor to hire a Loan Modification Company, then you can afford an Attorney. But just be cautious while looking for help. This is a booming industry and there is a lot of greed. Doing this kind of research can be exhausting. You may still find that after researching them you are still unsure. It is very tedious work and does take time. Aside from researching them, you should know what questions to ask and read your agreement or contract carefully. I have provided some resources for you to begin your search. Better Business Bureau, Federal Trade Commission, Consumer protection agency, and rip off report.



    If you would like help locating an Attorney who can assist you in your area, please contact me. I will be more than happy to help.

     

    There is assistance available to everyone in any state.

     

    This is what we do for our clients:

    • I will analyze your situation and take an application to see if you qualify for free. You do not have to pay a Retainer Fee until your case has been reviewed and accepted.
    • The Attorneys Legally place the foreclosure process on pause
    • Increased time to sell or rebuild your financial situation is an inherent benefit (Sometimes you are able to freeze your payments for up to 6 months depending on your hardship.)
    • Help stop harassing phone calls (tell your lender to contact your Attorney who will speak on your behalf)
    • Formulate a plan that fits with in the home owner's budget (reduced rate, 30-40 fixed term)
    • Work to have missed payments moved to end of the loan
    • To work with your lender to provide you with the best modification that fits with in your budget
    • Work to reduce or eliminate 2nd or 3 rd mortgage, or ask for a principle reduction if you owe more than your loan amount.
    • To keep your family in your home and avoid displacement.
    • To do everything possible to work out a solution. If your lender is unwilling to work with us, they need to provide a good explanation as to why. We will then talk to you about some other foreclosure prevention options that are available to you. Our mission is for you to keep your property, but this may not be beneficial to everyone. 
    • Provide you with a money back guarantee if for some reason they are unable to work out a solution that improves your current situation (which is about a 2% chance after having your case accepted), no questions asked!

     


    The Fees are about the only thing competitive. You may think that having a team of Attorneys assisting you would be very expensive. This was one of the biggest challenge in my research. Finding not only legit help for my clients, but to make sure the fees are affordable. The fees happen to be very fair and competitive with even loan modification companies who don't even come close to providing you with an array of services. The best thing is, your going with a trusted Attorney who has credentials to back it up.

    I pledge to be 100% honest, diligent, and treat you with integrity.

    More Useful Blogs:

    Loan Modification Scams Update

    How The Foreclosure Process Works For Every State

     

     

    Hire Attorney or Loan Modification Company

    Loan Modification  FAQ's

    Why won't my lender won't work with me?

    How to Prevent Foreclosure on Your Investment Property

    www.KeepYourProperty.info

    Choosing a Loan Modification Company


    If you feel this information was useful, please comment

     



      Bookmark and Share

     

    close

    This entry hasn't been re-blogged:

    Re-Blogged By Re-Blogged At
    Topic:
    Lending / Financial
    Location:
    Florida
    Groups:
    Mortgages
    All About Mortgages/Mortgage Networking
    Foreclosure Talk
    FRAUD, Scams and Ponzi schemes REPORT THEM HERE!
    Tags:
    scams
    foreclosure
    help
    past due payments
    loan modification scams
    loss mitigation scams
    loan mod scams
    foreclosure help scams

    Post a Comment
    Spam prevention
    Spam prevention
    Show All Comments
    Anonymous
    Mike Penn

    FYI, Mike Luchen is in prison and you will not hear back from MIKE LUCHEN from the Guardian Advocate Group for a long long time...he has been convicted and is in jail!  He evidently thought being a top agent gave hime the right to go against the law!

    Coldwell Banker in White Plains has dropped him and his license and his listings have been assigned to other agents.  Coldwell Banker has silenced their agents and have been told to say he has taken time off due to personal reasons.

    I can't stand these people who make it bad for the rest of us honest and hardworking agents!

     

    Here is his site

    http://www.mikeluchen.com/

    http://www.guardianmods.com/ 

    Oct 10, 2009 04:31 AM #51
    Anonymous
    Ruel Anda

    Beware of the PRIORITY MORTGAGE GROUP, INC. DBA PRIORITY FINANCIAL GROUP. They have a DRE licence 01789005. I paid them $4000 advance fee to handle my loan modification application with IndyMac. Guess what? My house was foreclosed anyway. I called IndyMac why was my house foreclosed despite my pending loan modification application. They said that the only communication they got from the Priority Mortgage Group was a request to list them as an authorized party on my loan and NOTHING ELSE!

    Now I am having difficulty recovering my money because their Designated Officer, Mr. David Gomez, continues to ignore me.

    I guess the DRE licence is not a foolproof indicator to tell the difference between acam artists and honest-to-goodness professionals.

    I would be very happy to see their licence revoked.

    Oct 14, 2009 05:59 AM #52
    Rainer
    128,627
    Dan Quinn
    Berkshire Hathaway HomeServices PenFed Realty - Silver Spring, MD
    Dan Quinn

    This is all wonderfully good advice.  You have put it so well here.  Many consumers have been duped into paying upfront loan mod fees and have nothing to show for it. 

    Thanks for providing this needed info to all of those struggling to pay their mortgages and looking for some relief.

    Nov 03, 2009 04:37 AM #53
    Anonymous
    Daviv

    MIKE LUCHEN aka Mike Yeninas is in fact a convicted felon now. He is serving his sentence in Ottisville Federal Prison Camp. Hopefully the state will yank his real estate license for good. Its people like this that give all the good Realtors a bad name

    Nov 03, 2009 10:25 AM #54
    Anonymous
    J. Sandoval

    Callie just called me. She made a great point in which she pointed out the methods I used to get her attention. I should not have questioned her Christianity. I know understand the situation and what had transpired. I apologize to you Callie. i truly ask for your forgiveness in the way i went about trying to contact you.

    Even after i did what I did- she offered advice and counseled me on my situation. Again- Callie....I apologize and thank you for your efforts.

    Nov 30, 2009 06:35 AM #62
    Anonymous
    laon moddette

    KSA - No they can not advise you not to make your payments! 

    Dec 26, 2009 01:36 PM #63
    Rainmaker
    132,386
    Marty and Laurie Gale
    Utah Realty - South Jordan, UT
    Utah Realty | 801-205-3500 | UtahRealtyPlace.com

    Hi,

    Forensic loan audits are yet another phony foreclosure-relief service hawked by loan-modification consultants trying to cash in on the desperation of homeowners facing foreclosure. The foreclosure-relief industry continues to be long on promises, but short on results. Folks keep your money. 

    May 07, 2010 01:55 AM #68
    Anonymous
    Valere Knight

    I went through a company called AFS (A Fresh Start), in 2009, and the attorney they work with, Michael M. Yellin in LA.

    I filled out all the papers, paid $2000 to the attorney and waited, and waited, and waited.  They did send all the papers to my lender about the time the lender started forclosure procedings.  I kept calling the attorney's rep that was the POC but she could never get the lender to assign a negotiator.  When my lender finally assigned a negotiator my house was going up for auction and I had no choice but to take their offer or lose my house.

    I had a ARM and the new modification gave me a lower interest rate by 1.5% and is still a ARM.  I felt I got scammed by AFS and the lawyer.  To top it off my lender tacked on $18,000 to my loan and part of that was their lawyers fees, so I got double whammied.

    With all the hype that was in the news and all the programs out there I was under the assumption that these attorneys that are working for you would try to find the best deal and not rely on just my lender.  So much for assumptions.

     

     

     

    Jun 15, 2010 02:31 AM #69
    Anonymous
    William Mesquite

    I have just had a bad experience with priority finanacial group in San Dimas, John De La Garza handled my modification request, the one thing that I request that he keep me informed on the update calls with the BofA on the status of my modification, he failed to do that, when you call him and leave messages to call you he fails to respond. I received notification that my home is up for sale Aug 17th 2010, I was never told by priority finanacial of this only thru my calling BofA was I made aware of what was going on, when I questioned John Dela Garza about this he said not to worry that all homes that are delinquent will automatically go into forclousure but as long as you are in active stage of modification they cannot sell your home, I asked if I should attempt to make my loan current, he said that these are scare tatics that the banks do in order to get money from you and not to worry because once the modification is complete you will be forgiven for the late fees and such and any money you owe will be be put on the back end of the loan so if you send money it will throw the numbers off and figures will have to be recalculated. I am really disappointed that I did not qualify for the modification but I am more disappointed that companies like priorty financial group are allowed to operate with agents like John De La Garza.  

    Aug 05, 2010 08:22 AM #70
    Rainmaker
    94,176
    C. Thompson
    Loan Modification - Bethesda, MD
    Loss Mitigation Cases

    William contact me right away. 407-219-8739. I am the one that wrote this blog. I may have some suggestions for you. Thanks

    Aug 05, 2010 09:46 AM #71
    Anonymous
    Chris

    My Dad bought his home in 1988. Since then he has divorced, remarried, refinanced, remodeled and now is divorced again. Now the value of his home is less than what he owes and since he divorced he can't afford the payments on his own. He went through the the home loan mod through his bank which is BofA who put him on a trial payment plan FOR ALMOST A YEAR. He made all the payments on time then they told him he was rejected for the mod and needed to pay what he owed which is $13,000 if he wants to keep the house. This is the first home he's ever owned and doesn't want to lose it. It seems even the banks are in on the scams theses days. They tell you to go on a "trial" payment plan then reject you when you do everything they've asked and paid on time. It doesn't make any sense. If he had that kind of money he wouldn't need the modification. Are they getting money from the government while they make people think they are getting a modification? The only option seems to be a short sale where the bank isn't going to get the money their owed anyways.

    Please help with any advice. I am now in the process of potentially getting a modification through BofA. My wife and I have recently both been laid off of work and we are scared that getting into any home loan mod, even with our lender, is a scam.

    Thank,

    Sep 27, 2010 05:00 PM #72
    Anonymous
    J E

    Like so many others my husband & I also tried to get a modification with BoA after a year of trial pymts we were told our modification was denied and that we are now past due over $13,000.00 and we were now in foreclosure again BOA put us in a Modification Review.  It has now been another 6 months and they just declined us for MHA program but the we may qualify for another modification and he we wait again.  I started to see if there is any company that can help us.  We don't want to loose our home.  I have been contacted by three companies ( all law firms), NMHC, Friedland law group, and Defense law Center, they all say they can help us.  I am really scared to commit to one of these companies as we really don't have the money ( they all want $2000 - $4000) to help us. Has anyone dealt with any of them, or is there some company out their that can really help us?  Please email me at Dutmax07@yahoo.com if there is anybody out there that can help

    JE

    Feb 03, 2011 10:34 PM #73
    Anonymous
    Matt

    Hi, I am dealing with a company called Estate Law Group and they aksed for money up front and two additonal payments down the road. I could not find anything negative about them and that is why I chose to use them, if anyone out there has had experience good or bad please let me know soonest because I am really searching before I give them another red penny and end up losing my home anyway.

     

    Thanks

    Mar 13, 2012 03:45 AM #74
    Anonymous
    jd

    Matt, I was contacted by Estate Law Group and am looking into their background now.  So far there hasnt been much info available, which makes me leary.  However, the conversations I've had with my account rep have all stayed away from cost or fees and have been noticably absent of any overt requests for private information.  I'm interested to know what you decided or found out and will continue to look for more details or background on the business.

    Mar 27, 2012 11:25 AM #75
    Anonymous
    Jeanette

    I was contacted by Estate Law Group and spoke with them yesterday.  The gentleman sounded very professional.   I decided to check the internet for reviews on them.   I also searched the attornies that are listed on their website www.estate-lawgroup.net.    Some of the same attornies are listed on the website for State Law Group.  I could not find any information on two of the attornies that were listed.  I found several complaints about the State Law Group, so I am not going to use Estate Law Group.  If Estate Law Group is using the same attornies, I can't have faith in that company either. 

    Apr 24, 2012 11:22 PM #76
    Rainmaker
    665,733
    Pete Xavier
    Investments to Luxury - Pacific Palisades, CA
    Outstanding Agent Referrals-Nationwide
    Sad that these scams are still happening. Marked this post for a clean up.
    Jan 07, 2013 03:34 PM #80
    Anonymous
    david gregory

    Can you help me please let me know

    Aug 05, 2013 02:20 AM #171
    Anonymous
    David
    WARNING... Stay away from this scamming, inhuman firm. They got me good for over $3200. They goated me along for over a year making me do the same submissions over and over. Then, "NO CONTACT". No return calls. I know this has happened to others..and would like to know if anyone knows of a multi-party law suit I can join for possible recovery? They encouraged me that the new loan was imminent, right up to the end. The purported boss/owner is Richlyn Graf. The main con artist is, John Davi.
    Jan 30, 2014 06:45 AM #194
    Rainer
    8,159
    Sara Chris
    Absolute Consultant Group - Toluca Lake, CA

    Thanks C. Thompson for the very precise breifing on loan modification. NOw a days these scams are creating many problems regarding short sales.

    Home owners should really beware of these scams.

    Sep 02, 2014 05:23 PM #195
    Ambassador
    1,450,029
    Jim Crawford
    RE/MAX Paramount Properties - Atlanta, GA
    Jim Crawford Atlanta Best Listing Agents & REALTOR

    Thank you for sharing this information.  It is most informative.

    Buyers, sellers and real estate professionals could really benefit from it!

    Have a productive week! 

     

    Sep 16, 2014 02:22 AM #196
    Post a Comment
    Spam prevention
    Show All Comments

    What's the reason you're reporting this blog entry?

    Are you sure you want to report this blog entry as spam?

    Rainmaker
    94,176

    C. Thompson

    Loss Mitigation Cases
    Ask me a question
    *
    *
    *
    *
    Spam prevention

    Additional Information