My Real Estate Blog

Days after a federal economic stability agency said the Obama administration's mortgage assistance program was vulnerable to fraud, a coalition of federal, state and community organizations launched a new campaign to fight that fraud.

The Loan Modification Scam Prevention Network, led by Fannie Mae, Freddie Mac, the Lawyers' Committee for Civil Rights Under Law, NeighborWorks America and a host of other agencies, recently announced a national campaign to prevent loan modification rip-offs and other scams.

Loan modification scams are schemes in which people take advantage of vulnerable homeowners. Scammers prey on homeowners in distress by guaranteeing to help the homeowner obtain a modification of their mortgage to save their home. Frequently, the borrowers pay money up front but receive no help at all and their home is lost to foreclosure.

The new PreventLoanScams.org website includes:

• An electronic complaint form that can be filled out easily by an individual who has been scammed or by counselors or friends helping a victim of fraud .

• Names of individuals and organizations who have been identified by enforcement agencies to have allegedly committed a loan modification scam.

• Information on how to avoid a loan modification scam.

• State-by-state information about rules, regulations and resources available to struggling homeowners.

• News and information on enforcement efforts.

Homeowners who believe they may have been a victim of a loan modification scam, can also call the Homeowners Hope Hotline at 1-888-995-HOPE to log a complaint and to receive free foreclosure prevention counseling.