subject: Loan Modification Programs In Minnesota: Watch Out For Scams! [print this page] Recently the Minnesota Attorney General filed lawsuits against companies that charged unlawful and exorbitant fees to help homeowners negotiate modifications to their mortgage home loans. The scary part is that these companies exploited the very fears of scams of the home owners themselves to manipulate them into their own scam! In 2009, the United States Congress funded a campaign called the 'Loan Modification Scam Alert' to warn homeowners of fraudulent mortgage home loan modification scams. This same alert has been very cleverly and fraudulently copied with its own variations, by at least one firm to desensitise and attract people into their own scam. Some scam firms have posed as legitimate companies and sent out 'scam alert' flyers to home owners. The psychology behind this is that if someone gives you warnings, they soothe your fears and you tend to trust them, and then they step in and get you!
So, remember when you employ the help of a loan modification expert or company, that by Minnesota Law, no advance fees are payable until they have delivered the services they promised. This restriction does not include attorneys who render help and advice in the course of their normal legal practise. Here is where a danger lies. Be careful of home loan modification companies who use the status of members of their company who are attorneys to bypass the ruling of the Minnesota Law System. The attorneys need to be practising as attorneys with a normal legal practice in order to qualify, and not specialised as loan modifiers. Some companies claim to 'work with a firm of attorneys' in order to protect your best interests. Some fraudulent companies have been known to promise enormous reductions on your mortgage home loan payments for absolutely free in the name of kindness and charity. These 'non-profit' organisations offer such treats as forensic mortgage auditors, attorneys and skilled negotiators as part of their deal. However, when you look closely, you will see that they expect you to donate generously to that same 'charity'.
Never ever sign away the ownership of your home in return for a 'temporary' rescue package that may include settlement of defaulted payments, and other debts, such as credit card debt. They may promise you the option to're-purchase' your house after just paying rent for a while. This is not going to happen. If you sign over your house, you have lost your house! A scam artist may act as a 'go between', between you and the lender, and relieve you of your regular mortgage payments never paying them in to the lender as you were led to believe he would. These are all ways of separating you from your money! If you are in a situation where you feel you need legal advice, by all means get it and pay for it - but choose your own attorney separately from any loan modification company.
You need also to be wary of out of state companies that offer loan modification services to you in Minnesota. Remember laws vary from state to state and you will be safer choosing someone from within Minnesota, then you know you are most likely to be in harmony with all the local regulations.
Remember that advice on home loan modification is available free if you look for it. You can approach the Minnesota Home Ownership Centre, or one of the many legitimate companies that offer free initial advice on loan modification as one of many of their other services.
