It is perhaps the most devastating of financial crimes. Scam artists prey on desperate homeowners, promising mortgage relief but leaving their victims even more in debt. If your home is underwater or you have missed a mortgage payment, you may have already been approached by a so-called mortgage rescue company. While there are legitimate organizations that help homeowners keep their homes, it is sometimes difficult to tell the good guys from the bad actors.
So how do you tell the difference between a company that truly has your best interests at heart and one that simply wants to line its pockets? There are a number of warning signs you can watch out for, and the presence of these red flags could mean you are dealing with a scam artist.
Beware of Guaranteed Results
There are no guarantees in life, and that applies to the mortgage rescue industry. While some companies do have good track records, no legitimate firm would guarantee results.
If you are approached by a mortgage rescue company that promises results, ask a lot of questions and find out how they are able to make such claims. If the company insists that homeowners get mortgage relief 100 percent of the time, chances are you are looking at a scam artist and should just walk away.
A Cutoff of Communication
One of the scam artists’ favorite tactics is to advise homeowners not to talk to an attorney, their mortgage company or anyone else involved in the home payment process. This is a big red flag and a sure sign you need to contact a good lawyer — or simply walk away.
Some scam artists go a step further and advise homeowners to stop making their mortgage payments. They often claim that missing payments will make them eligible for government assistance, but that is not necessarily the case. Be wary of a mortgage rescue firm that advises you to deliberately miss a payment.
Pressure to Sign
A good mortgage refinancing deal will still be there tomorrow. Be wary of any mortgage broker or mortgage rescue firm that pressures you to sign immediately.
Be sure to read any documents you are presented, and do not rely on the word of the person pushing the deal. Consult an expert if anything is unclear, and always get a second opinion before taking any deal or signing up for any service.
The whole reason you need help with your mortgage is that you do not have much money. You should not waste what little cash you have chasing a dream that may never come true.
Never pay an up-front fee for any mortgage rescue or refinancing deal. The fees should come only after the deal is done to your satisfaction.
If you spot any of these warning signs, you should walk away from the supposed deal and contact the local authorities to report a potential scam. Homeowners have been losing millions of dollars to scams such as these, and it is important for homeowners to protect themselves and each other by reporting the bad actors to the authorities.