The Consumer Financial Protection Bureau (CFPB) is warning consumers to beware of mortgage assistance and foreclosure relief scams targeting homeowners in their time of need.
Many such scammers use websites, emails, and other advertising materials with government logos, letterhead, or other marks to trick consumers into believing that their services are associated with official government agencies.
One recent scam claimed that, for a fee, they could help people get benefits from programs offering government-sponsored relief for homeowners, including the recent nationwide mortgage servicing settlement or the federal Independent Foreclosure Review program. In fact, you don't have to pay anything to get the benefits of these programs, you just have to qualify.
The national mortgage settlement is a $25 billion agreement with the nation's five largest mortgage servicers to provide relief to homeowners, including loan modification and refinancing, for homeowners covered under the agreement. The federal Independent Foreclosure Review program provides homeowners the opportunity to request an independent review of their foreclosure process under consent orders between federal regulators and 14 mortgage servicing companies.
How to Spot a Scam
Mortgage assistance and foreclosure relief scams are designed to take your money. They often use mail or email designed with emblems, logos and names intended to mimic government agencies or programs, lawyers or law firms, or legitimate creditors.
Unfortunately, scammers are also constantly re-inventing new ways to scam struggling homeowners. So it's not always easy to tell the difference between the scams and legitimate services. But there are a number of ways to help spot the fakes.
Keep an eye out for red flags if a mortgage assistance or foreclosure relief scheme:
- Tells you to stop making mortgage loan payments. Not making your mortgage loan payments could hurt your credit score and limit your options.
- Tells you to start making payments to someone other than your servicer or lender.
- Asks you to pay high fees upfront to receive services.
- Promises to get you a loan modification.
- Asks you to sign over title to your property.
- Asks you to sign papers you do not understand.
- Pressures you to sign papers immediately.
Get Real Help, Fast
Don't be fooled. You can get real mortgage assistance and foreclosure help by calling CFPB toll-free at 855-411-2372. There you can be connected to a U.S. Department of Housing and Urban Development (HUD)-approved housing counselor.
A mortgage assistance or foreclosure relief scam could cost you your house. If you think you've been scammed, report suspected fraud immediately. The longer you wait, the more difficult it could be to prevent serious problems. There are lots of ways to register a complaint or report suspected scams:
- Contact your State Attorney General.
- Report a scam to the federal Financial Fraud Enforcement Task Force.
- File a complaint with the Federal Trade Commission.
- Tell the CFPB about your experience.
Share This Information with Others
It can be hard for people to talk about finances, especially if they're in trouble. Even if you're not facing foreclosure yourself, we highly encourage you to share a link to this advice with your friends and family. You never know who you might be able to help.