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Home | News | Foreclosure | HUD Launches Online Tool to Fight Loan Modification Scams
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HUD Launches Online Tool to Fight Loan Modification Scams

Loan modification scams are on the rise, but ""HUD"":http://portal.hud.gov/portal/page/portal/HUD is taking action to put these con artists out of business.

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""Preventloanscams.org"":http://www.preventloanscams.org/ was recently launched by HUD in partnership with the Loan Modification Scam Prevention Network, a national coalition of public and private enterprises led by the ""Lawyers' Committee for Civil Rights Under Law."":http://www.lawyerscommittee.org/issues?id=0007 The Web site was created to provide homeowners with a single destination to report alleged scammers.

""Homeowners at risk of foreclosure can be easy prey for home loan modification scammers,"" said John Trasviña, HUD assistant secretary for fair housing and equal oppportunity.

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Trasviña said dishonest individuals often lure vulnerable homeowners into foreclosure rescue scams by making false promises, frequently claiming they can lower mortgage payments or stop the foreclosure process. Instead of receiving help, these troubled homeowners lose time and money, he explained.

Through Preventloanscams.org, complaints filed online are added to a national complaint database and are forwarded to the appropriate law enforcement center for review. In addition, HUD has directed its local fair housing and housing counseling grantees to begin reporting alleged loan modification scams via the Web site.

Before the launch of Preventloanscams.org, federal, state, and local government agencies could not share complaint data with nonprofit organizations. However, the new system allows for better analysis of trends across jurisdictional lines, which HUD says will likely lead to an increase in private enforcement action filings.

The network estimates that this online tool will assist approximately 50,000 homeowners affected by loan modification scams. Clearly, the creation of this national complaint database is a major step in the fight against loan modification scams.

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