It's a problem we've heard about time and time again, people struggling to make the payments on their home. But as ABC2 News Joce Sterman explains, your worries could get even bigger if you choose the wrong company to help you renegotiate your loan.
The mortgage meltdown has many people looking for ways to hold onto their houses and some believe salvation comes straight to their mailbox or email inbox in the form of loan modification offers. Angie Barnett with the Better Business Bureau says, "Some consumers are so desperate, they're falling for these."
Barnett is talking about loan modification scams. She says there are many reputable companies and attorneys that can help negotiate a change to make your loan more manageable, but believes there are plenty of bad operators out there. Barnett tells ABC2, "You're paying for services in which nothing is actually delivered."
The BBB says some of these scam companies ask for thousands upfront, claiming they can lower your payment or interest. But Barnett says once they've got your money, they disappear, leaving you and your home in jeopardy. That's why the BBB says you've got to be careful when considering loan modification.
Here are a few tips from the BBB:
-If the company asks for a hefty upfront fee for its services, walk away
-The BBB believes it may be safer to go with a company that doesn't collect until they've gotten results
-Be sure to read the fine print in every contract
-Be wary of any company that tells you to stop communicating with your lender
Barnett says cutting ties with your lender may leave you out of luck if the modification company doesn't come through. She explains, “Once you get that close to the point where now your home is forced into foreclosure, you're not able to get help." And it’s help you’ll need when trying to save your home.
