National Consumer Protection Week Provides Opportunity to Focus on Mortgage Rescue Scams
Washington, D.C. – March 8, 2012 – (RealEstateRama) — The Loan Modification Scam Prevention Network(LMSPN) in conjunction with National Consumer Protection Week (NCPW), March 4-11 is alerting homeowners to combat loan modification scams, especially those that may appear to be help from one of the various new foreclosure assistance programs recently announced by the government. This effort, led by NeighborWorks’ nationa l Loan Modification Scam Alert campaign, the Homeownership Preservation Foundation’s Homeowner’s HOPE Hotline and the Lawyers’ Committee for Civil Rights Under Law’s Prevent Loan Scams campaign, is designed to help homeowners protect themselves against loan modification scams, find trusted help and report illegal activity to authorities. Since the coalition’s launch two years ago, more than 21,000 people have reported loan scams in the Lawyers’ Committee’s national Loan Modification Scam database, and itâ€™s believed that many more homeowners have been affected. The six most important loan modification scam warning signs can be found at www.loanscamalert.org.
NeighborWorks America is an official partner of NCPW, the federally coordinated consumer education campaign that encourages individuals across the country to take full advantage of their consumer rights.
In the past few months, two important sources of foreclosure help have been announced by the federal government: the Independent Foreclosure Review program created to ensure that finished foreclosure actions were correctly managed, and a multi-billion mortgage servicing settlement that could provide money to help homeowners reduce their mortgage payments. Through information collected by the Loan Modification Scam Prevention Network, the coalition knows that incidences of alleged fraud associated with these two programs are on the rise.
Millions of Americans continue to be at risk of losing their homes to foreclosure due to job loss and income reduction, as well as unsustainable mortgage loans. While many will seek relief in the form of reputable and certified loan modification services â€“ already more than 1.3 million have sought help from HUD approved counselors sponsored by the National Foreclosure Mitigation Counseling program — too many will instead become victims of scams.
â€śForeclosure continues to be a problem in America, as do ever-changing foreclosure related scams, which recently have begun to take on the appearance of legitimate federal and state help programs,â€ť said Eileen Fitzgerald, chief executive officer of NeighborWorks America. â€śThis National Consumer Protection Week, the Loan Modification Scam Alert campaign is intensifying outreach efforts so that homeowners in distress seek the right help.â€ť
“Loan modification scams are a serious problem, and we continue to work with our federal and state partners to shut them down,” said U.S. Treasury Department Assistant Secretary for Financial Stability Tim Massad.Â “Homeowners should remember that there is never a fee to apply to the Obama Administration’s Making Home Affordable Program or other assistance from the federal government.”
â€śMillions of distressed homeowners have become vulnerable targets to criminal third-party scammers, con artists, and thieves,â€ť said Ed Jennings, Jr., Regional Administrator for HUD in Atlanta. â€śOne should never have to pay for foreclosure counseling or assistance, that’s why we need homeow ners to be vigilant by seeking out HUD-approved housing counseling agencies to obtain help and avoid being scammed.â€ť
In 2011, HUD piloted the Know It. Avoid It. Report It. campaign in Miami, Chicago and Los Angeles to help inform struggling homeowners about the importance of working with HUD-approved agencies as they fight to keep their homes. HUD is launching the second phase of this campaign beginning March 8th in Atlanta, Georgia, followed by local campaigns in New York-New Jersey, Orlando, Florida and Riverside-San Bernardino, California. These are attractive areas for scammers, considering they all continue to struggle with high foreclosure rates. In support of National Consumer Protection Week, HUD urges homeowners to learn about these kinds of activities and take action in reporting them by visiting HUD.GOV/PreventLoanScams or calling the HOPE Hotline at 888-995-HOPE.
“As long as the foreclosure crisis continues there will be thousands of fraudulent opportunists who pretend to be legitimate but who are actually taking advantage of distressed homeowners and blocking their access to all the real help that is out there,” says Yolanda McGill, senior counsel for the Lawyers’ Committee. “The Lawyers’ Committee is analyzing the reports as they come in to the Database so that we can inform our enforcement partners about these dangers.”
â€śIf you are seeking a loan modification or other solution for your mortgage, it is very important to reach out directly to your mortgage servicer or to a HUD-approved, non-profit counselor. There areseveral programs available to at-risk homeowners via the government and the private sector. However,homeowners should always be wary of any organization that asks for fees or makes promises of a loan modification. The bottom line is never pay anyone tohave your loan modified. If it sounds too good to be true, then it most likely is,” said Faith Schwartz, Executive Director of HOPE NOW. “HOPE NOW has worked hard over the past few years to raise awareness of mortgage assistance scams and we continue to work with NeighborWorks America and others to educate consumers on the issue.”
“Every day, hundreds of Americans facing foreclosure fall prey to unscrupulous con artists looking to cash in on distressed homeowners’ desperate need for help, an alarming trend that the Homeownership Preservation Foundation (HPF) has been working diligently to counter through counsel provided via our national Homeowner’s HOPE Hotline at 888-995-HOPE and through joint efforts with the Loan Modification Scam Prevention Network,” said Josh Fuhrman, Senior Vice President of Community Affairs for HPF. “It is quite common for scam artists to pretend that they are legitimately connected with government mortgage relief programs, and the recently announced major mortgage servicer settlement is already providing fodder for additional deceptions. In the spirit of National Consumer Protection Week, we strongly encourage homeowners facing foreclosure to call the HOPE Hotline today to get the information they need to protect themselves and learn the warning signs of mortgage scams.”
â€śFraud artists continue to refine their techniques for preying on distressed borrowers with false promises of easy fixes. We strongly encourage every homeowner and every ally of homeownership to visit LoanScamAlert.org during National Consumer Protection Week to learn how to spot and avoid the latest mortgage scams,â€ť said Senior Vice President Hollis McLoughlin, Freddie Mac.
NeighborWorks America,Doug Robinson, ">, 202 220-2360
Lawyersâ€™ Committee for Civil Rights Under Law, Stacie Royster, (202) 445-6101
U.S. Dept. of Treasury, Homeownership Preservation Office, Alvina McHale, (202) 622-2137
U.S. Department of Housing and Urban Development, Joel R. Ibanez, (202) 422-4338
Freddie Mac, Brad German, (703) 903-5645
Homeownership Preservation Foundation, Josh Fuhrman, (612) 230-4024
HOPE NOW Alliance, Brad Dwin, (202) 589-1938
About NeighborWorks America
NeighborWorks America creates opportunities for people to improve their lives and strengthen their communities by providing access to homeownership and to safe and affordable rental housing. In the last five years, NeighborWorks organizations have generated more than $19.5 billion in reinvestment in these communities. NeighborWorks America is the nation’s leading trainer of community development and affordable housing professionals. For more information visit www.nw.org.