Notes and Opinions from one of Arizona's Most Trusted Loan Teams

Avoiding Rip-offs and Scams if you are in trouble on your mortgage.

With all the recent emphasis on loan modifications as a means of avoiding foreclosure, the "cockroaches" are starting to come out of the woodwork. If you are in trouble on your mortgage, the last thing you need is some hustler telling you he can fix everything if you just give him $1000. (or $2000, or $3000) A recent arrest in the Phoenix area involved a fast talker who took more than $25,000 from desperate homeowners and then didn't do a thing for any of them. Please beware.

Here is the best way to handle loan modification requests. Talk to the lender. Earlier in 2008, the loss mitigation departments at most banks and mortgage companies were completely overwhelmed by the surge in mortgage delinquency and foreclosures. They did not respond well or quickly to borrower's requests for help. Those departments have been staffed up and are coming up to speed. The mortgage company does NOT want your house and they are making as much accommodation as they can to avoid foreclosures.

If you have trouble reaching or dealing with the mortgage company, contact a legitimate housing counselor. Almost every level of government has a housing authority that can guide you to the right agency for help. There will probably be little or no cost for the help.

In those cases where you feel you need legal representation with the mortgage company, consider hiring an attorney. Many practices have the necessary real estate and mortgage knowledge needed to deal with the legal issues surrounding your home loan. Some of them are starting to advertise these services.

It's bad enough to be in the middle of a personal financial crisis. Do not make it worse by becoming a victim of a scam. Only your mortgage company can make the arrangements you need. Use one of the methods described above to avoid making a bad situation worse. Good luck.