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HAMP Scams

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From my “when it gets dark outside, the rats will come out and play” collection…

Several government agencies have formed a task force to stop scams on homeowners applying for the Home Affordable Modification Program (HAMP).  The agencies include the U.S. Department of Treasury, the Office of the Special Inspector General for the Troubled Asset Relief Program (SIGTARP), and the Consumer Financial Protection Bureau (CFPB). Their goal is to shutdown fraudulent illegal operations.  Home Affordable Modification Program is funded by Troubled Asset Relief Program to prevent foreclosure and is administered by the U.S. Department of Treasury. They investigate companies that charge fees and falsely promise to lower homeowners’ mortgage payments through the Home Affordable Modification Program.

Fraud Alert

The task force issued a fraud alert to warn consumers, so they could recognize the scams and avoid them. The alert is quoted below.

“If you are struggling to pay your mortgage and are seeking a mortgage modification, keep the following tips in mind:

You can apply to the federal Home Affordable Modification Program (HAMP) on your own or with free help from a housing counselor approved by the U.S. Department of Housing and Urban Development (HUD). Applying to the program is always FREE. For more information on how to apply, call the Homeowner’s HOPE™ Hotline at 1-888-995-HOPE (1-888-995-4673) or visit www.MakingHomeAffordable.gov.

Only your mortgage servicer has discretion to grant a loan modification. Therefore, no third party can guarantee or pre-approve your HAMP mortgage modification application.

Beware of anyone seeking to charge you in advance for mortgage modification services – in most cases, charging fees in advance for a mortgage modification is illegal.

Paying a third party to assist with your HAMP application does not improve your likelihood of receiving a mortgage modification. Accordingly, beware of individuals or companies that ask you for payment and tout success rates or claim to be “experts” in HAMP.

If an individual or company claims to be affiliated with HAMP or displays a seal or logo representing the U.S. government in correspondence or on the Web, you should check the connection by calling the Homeowner’s HOPETM Hotline.

Beware of individuals or companies that offer money-back guarantees.

Beware of individuals or companies that advise you as a homeowner to stop making your mortgage payments or to not contact your mortgage servicer”.

The purpose of this alert is to inform homeowners that are in considering loan modification so they don’t fall prey to fraudsters.

Credit Damage Expert, John Ulzheimer, is the President of Consumer Education at SmartCredit.com, the credit blogger for Mint.com, and a Contributor for the National Foundation for Credit Counseling.  He is an expert on credit reporting, credit scoring and identity theft. Formerly of FICO, Equifax and Credit.com, John is the only recognized credit expert who actually comes from the credit industry.  Follow him on Twitter here.

 

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