7 On Your Side
Mortgage modification scams and ripoffs
NEW YORK (WABC) -- It is one of the top scams in the Tri-State, and nationwide - phony pitches that guarantee to lower your monthly mortgage payment. However, these pitches could wind up costing you even more.
Sometimes for-profit mortgage modification companies are camera shy, other times - they're long gone, preying on homeowners in trouble.
"A lot of these types of operations are being run by individuals who have no expertise or no real skill set to engage in loan modification," said Eric Kanefsky of the New Jersey Division of Consumer Affairs.
Typically they ask for thousands in upfront money, and sometimes guarantee results.
"Frankly they're out just to attempt to steal your house from you, take your money and run," added Kanefsky.
The first step is to not pay a third party. Instead, contact your own lender and apply for a mortgage modification yourself.<p. Next, avoid playing upfront fees. Companies that are trying to scam you will try to get thousands before doing anything.
Also, always keep paying your mortgage. 7 on your Side has helped victims who were told it was okay to stop paying. This is a big mistake, because you could wind up in foreclosure.
Lastly, report any suspicious activity to your local consumer protection agency and to the Federal Trade Commission.
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