How to Avoid Home Loan Modification Scams?

Home loan modification is easily one of the best ways to save one's home and avoid foreclosure. But as more and more homeowners fall into default, more and more scams have also turned up. And when you’re on the verge of losing your home, the last thing you want is some fake firm who tricks you out of your money. That's why it's important to stay on guard, watch out for suspicious business, and work only with experienced professionals. This guide offers a few tips on avoiding home loan modification scams and finding the right people to help you out.

Look them up.
The Better Business Bureau (BBB) provides a list of legitimate companies and their ratings, whether or not they are signed up. If you're dealing with a loan modification attorney, the Bar Association can also be a good resource. Ask for client references and make a few calls to see what previous clients think of the company.

Don't pay upfront fees.
Upfront fees are the first sign of a loan modification scam. Some companies have been known to charge upwards of $7,000 upon initial consultation, before reviewing your file and without a guarantee of even starting the process. Don't be fooled by companies that try to "scare" you into paying up immediately.

Know their process.
At the outset, ask how the company handles loan modifications. The home loan modification process varies from case to case, and a good loan modification attorney will have a backup plan for every possibility. Find out what they normally do if the lender takes too long to respond, if the request is rejected, or if the first offer isn't good enough.

Make face-to-face contact.
The Internet has made it all too easy for scammers to reach potential victims. While you can find a good loan modification attorney online, it's still important to pay them a visit and make sure it’s a legitimate company. Don’t settle for an online or phone consultation; you need proof that you’re dealing with real professionals who know what they're doing.

Watch out for exact goals.
If a company promises to reduce your rate by a certain amount, chances are it's a scam. Again, home loan modification doesn't work the same way for everyone, so it doesn't make sense to set a single goal for every client. A good loan modification attorney will start by reviewing your case, and give you an estimate based on your situation.