“Government cracking down on mortgage scams”

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Alan Zibel and Christopher S. Rugaber of Associated Press have written an article that discusses the government’s response to an increase in

“criminal actors…preying on desperate borrowers caught up in the nation’s housing crisis.”

The article warns that “scammers” are trying to trick customers into paying hefty upfront fees for “loan modifications” that are rarely successful. Illinois Attorney General Lisa Madigan warns consumers to

“…stay away from anyone who says that they will save your home for money upfront.”

The Federal Trade Commission has sent over 70 letters to companies they feel are using questionable advertisements, as well as filing new complaints regarding 3 companies. The FBI is also investigating 2,100 cases of mortgage fraud.

“These are predatory schemes designed to rob Americans of their savings and potentially their homes,” Treasury Secretary Timothy Geithner said. “We will shut down fraudulent companies more quickly than before. We will target companies that otherwise would have gone unnoticed under the radar.”

However, Federal Loan Modification Law Center founder Bill Anz says he offers a refund to any client who doesn’t receive a modification. Anz also says that 20% of his 5,000 clients have received modifications thus far.

Even though some of these mortgage loan modification agencies do offer refunds, caution should still be exercised when enlisting their help.

If you have had problems with fraudulent debt companies, feel free to contact us.

Another resource for you is to join our Facebook Fan Page – Alabama Consumer Protection Attorneys where we share useful information about the same types of issues that we cover in this blog.

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