Predatory Loan Modification Companies Continue to Hurt Homeowners
You may have seen the advertisements, perhaps on Internet advertisements or on flyers. "Reduce your mortgage payments now! 100 percent guarantee or your money back! We know the tricks banks aren't telling you!"
To desperate and vulnerable homeowners, it sounds too good to be true. Unfortunately, it often is. Dishonest mortgage relief assistance became quite prevalent following the foreclosure crisis. With a continued high rate of foreclosure, unsuspecting homeowners can be trapped into paying a large fee to companies who end up hurting the homeowner's situation even more.
The National Fair Housing Alliance performed undercover examinations of 80 loan modification companies, with some startling findings. Over half required an upfront fee, which is against the law for non-attorneys. Nearly half guaranteed success, even if they didn't know any particulars about a homeowner's financial situation. Nearly a quarter of the companies told homeowners to stop making payments or to stop contacting their lenders. This is also illegal, unless the company also lets the homeowners know they can lose their home if they forego contact with their lenders.
These companies may pretend to be attorneys or claim that an attorney will be doing the work. An attorney can be a great help in discussing mortgage relief options, but know who you are dealing with. You can always check the state bar association where the attorney is licensed by calling or checking its website to make sure you are dealing with a legitimate attorney.
Ways a Bankruptcy Attorney Can Help
An experienced bankruptcy attorney can help you with a thorough discussion of your financial situation. An attorney can explain certain government programs that might help you save your home or help you prepare for mediation with your lender. An attorney can also explain how Chapter 13 bankruptcy might be right for you - and how it can be one of the most reliable ways of saving your home.
If you are in danger of losing your home, don't panic and fall for a loan modification scam. Speak with a bankruptcy attorney who can fully explain all of your options and work with you and your lender to save your home.