It’s been said that the best offense is a good defense.  Knowing the warning signs of a loan modification scam is the best defense, and can prevent you from being victimized by scam artists preying upon your emotions.  If you are an at-risk homeowner, beware of the following three major warning signs of a loan modification scam:

1. A request for upfront monies – Avoid any individual or firm that asks for a fee in advance.  Instead, seek the assistance of a HUD-approved housing counseling agency that does not charge consumers a fee for housing counseling.  Visit www.hud.gov for a list of agencies in your area.
2. A claim guaranteeing a loan modification – Only a lender can guarantee a loan modification.  If the claim sounds too good to be true, it is.
3. Advice which instructs you not to pay or talk to your lender – Keeping the lines of communication open with your lender is an important first step in moving toward a workout solution for your situation.  Do not withhold your mortgage payment from your lender or issue it to any individual or firm promising to make payments on your behalf.

If you believe that you have been the victim of a loan modification scam, visit www.LoanScamAlert.org or call 1-888-995-HOPE (4673).

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• 10 Warning Signs of a Mortgage Modification Scam
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