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Foreclosure consultants, foreclosure rescue, loan modifications -- are they all scams?

Posted June 8th, 2009 by Mike Scott

"Foreclosure" by Flickr user etgeek CC-BY-NCForeclosure consultants advertise they can Stop Foreclosure now! and We will save your home guaranteed! plus Free Consultation. These offers sound promising but most of them are scams where you are charged up-front fees, but they do nothing to help. They have you sign over your property to them and kick you out when it is convenient to them (they might charge you rent for awhile first), or they file bankruptcy in your name, which is one of the things you went to them to avoid.

So what can you do, how do you avoid these scammers? After all, they take out ads in the paper, have very professional-looking Websites, and claim affiliation with the government and the Making Homes Affordable initiative.

The first step is to say NO to fees. If someone wants to charge you money or have you sign legal documents that mention your property, walk away. The only organization whom you should deal with regarding your property is your lender.

You can get help for free! That's right I said FREE. You can receive free foreclosure avoidance counseling from a HUD-Approved Counseling Agency. The list of California agents is available on the HUD Website. Just type the address in your address bar or follow the link.

Second, foreclosure consultants have to start registering with the California Attorney General on July 1, 2009. You can contact the Attorney General's Office to find out if the consultant you want to work with is registered. You can also file a complaint with the Attorney General's office if you have been the victim of one of these frauds.

Third, if you have been deceived by one of these organizations there may be remedies available to you under California's Foreclosure Consultant Law. (CA Civ. Code 2945).

Most importantly though is getting the word out. Let us know if you have you interacted with any of these less-than- reputable organizations. Have you seen a Website for one one day only to have it disappear the next, and how have you handled the situation?

"Foreclosure" by Flickr user etgeek used under Creative Commons Attribution-Noncommerical 2.0 license.

Filed Under
Money & Privacy Consumer Scam -
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