Loan Modification Scams To Be Aware Of
Written on December 10, 2009 – 7:23 am | by Loan Rescue AZ
Sadly, I am rewriting this blog post series due to a major crash of our website several months ago. Originally, I wrote a series of several blog posts exposing several scams that I have encountered by talking to people who have spoken with ethically challenged loan modification companies.
First, I want to recommend that you do your due diligence on any company that you are seeking to do business with. Also, if you have a sense that something is just not right, do with that inner feeling as it is probably your gut instinct protecting you. With that, I would like to share with you the top 3 loan modification scams I have encountered in working with loan modification clients.
Loan Modification Scam #1 – No Job Required
Getting a loan modification approved requires a detailed process similar to that of qualifying for a mortgage, therefore you have to be able to show the mortgage company where your income is coming from to pay them on the new terms. Keep in the mind that one of the factors that led to the mortgage meltdown was the explosion of stated (overstated) and no income verification loans; many of which defaulted. It would not make sense for the bank to make the same mistake twice, so if you do not have a job or your cannot qualify based on your taxable documented income, you will most likely not be approved for a loan modification.
Loan Modification Scam #2 – Payment Quotes Over The Phone
I was really amazed to hear that companies were giving people quotes over the phone in an attempt to seduce them and earn their business. The fact is that a complete file needs to be completed and analyzed before an offer can be made, and chances are that the sales rep on the phone will have nothing to do with the approval process.
Loan Modification Scam #3 – The Over the Phone Guarantee
What I am referring to are those that guarantee by phone that they can get the loan modification done. This is impossible to do without having documentation fully reviewed, so it someone guarantees they can the job done, end that call as soon as possible.
Also keep in mind that the banks are still backed up with both loan modifications and short sales and the loan modification process can take up to several months to complete. If you are in a critical situation of have a pending foreclosure, it might be too late, so you need to take action as soon as possible.
A great alternative is to get the resources to do your own loan modification. Most people don’t realize that they can sometimes do a better job (because they are only concerned with one file instead of hundreds). Also, if the banks think a third party company is going to profit, they may not be as likely to help as opposed to knowing that they are helping a homeowner.
Here is a link to a do it yourself loan modification system put together by one of the most successful people in real estate. He used his system to modify 5 of his own loans and he offers a 100% money back guarantee on his product.
