Business & Finance mortgage

Another one bites the dust in the crackdown of loan modification scams

You would think if you were in the loan modification business you would know by now how serious the Federal Trade Commission is taking cracking down on business who are preying on struggling homeowners.  Evidently, some companies are still trying to fly under the radar.

U.S. Mortgage Funding Inc, Debt Remedy Partners Inc and Lower My Debt.com, LLC are under investigation for misleading consumers and taking their money.  According to some of the complaints by consumers these companies told homeowners to stop talking to their mortgage company and to stop making mortgage payments.  Thus resulting in the lender giving the homeowner a loan modification because it shows how distressed the home owner is.

Owners David Mahler, Jamen Lachs and John Incandela Jr., mislead thousands of homeowners into paying them up to $2600 in fees to help them modify their mortgage loans.

As part of its crackdown on mortgage scams targeting homeowners facing foreclosure, the Federal Trade Commission (FTC) has charged a national operation with marketing bogus loan modification services. Many consumers were told to pay half of this fee up front which is a violation of FTC rules and Florida law. The complaint was filed in the US District Court for the southern district of Florida.  These companies clearly violated the FTC ACT and FTC telemarketing sales rules by promising to modify their mortgages.

If violating the FTC rules wasn't enough, the companies also contacted people on the national do not call registry and didn't even bother to pay the fee to access this information.  This is one of the reasons why third party involvement has become so regulated.  This only shows how one bad apple can spoil it for everyone else.  Loan modifications came into existence because of a need by consumers, and even though many companies took money but didn't do any work only shows how greed can overwhelm people in distressed situations.  Don't let this happen to you and learn to fight back with knowing your options and facing your situation.

You can avoid being a target of a loan modification scam, by knowing your options and what laws govern your state.  If you are working with a third party you should know they cannot charge up front fees and cannot promise to modify your mortgage.
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