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Mortgage Modification Scams Make Top Ten Scam List for 2011

Mortgage modification scams made the list of ""Top Ten Scams of 2011,"" assembled by the ""Better Business Bureau"":http://www.bbb.org/us/article/bbb-names-top-ten-scams-of-2011-31711 (BBB) Wednesday.


""Because the federal government announced or expanded several mortgage relief programs this year, all kinds of sound-alike websites have popped up to try to fool consumers into parting with their money,"" said the BBB.

Scammers are representing themselves as government agencies or the BBB in order to gain consumers’ trust.

Most scammers require fees upfront in exchange for navigating the consumer through the process of obtaining a mortgage modification, according to the BBB, ""and almost all leave you in more debt than when you started.""


Following the BBB’s report Wednesday, the National Loan Modification Prevention Network announced Thursday its database has now collected more than 20,000 scam complaints. The database has been collection complaints since March 2010.

The National Loan Modification Prevention Network is a network of private and public sector participants, including federal, state, and local advocates and agencies.

""The database has become a central source of information for housing counselors, Treasury and the Office of the Special Inspector General for the Troubled Asset Relief Program, our pro bono law firm partners and others fighting foreclosure rescue fraud,"" said Joe Rich of the Lawyers’ Committee for Civil Rights Under Law, a nonprofit organization dedicated to fair housing, fair lending, and community development.

The Office of the Special Inspector General for the Troubled Asset Relief Program (SIGTARP) and the Consumer Financial Protection Bureau have recently targeted loan modification scams as well.

Together the two agencies joined with the Treasury Department to release a ""consumer fraud alert"":http://dsnews.comarticles/federal-agencies-fight-modification-scams-2011-12-02 in December warning homeowners against any entity that requires upfront fees and ensuring them that applying for a mortgage modification should be free.

SIGTARP targeted a host of online scams ""late last year,"":http://dsnews.comarticles/sigtarp-terminates-more-mortgage-modification-scams-2011-11-21 shutting down a host of online scams.

About Author: Krista Franks Brock

Krista Franks Brock is a professional writer and editor who has covered the mortgage banking and default servicing sectors since 2011. Previously, she served as managing editor of DS News and Southern Distinction, a regional lifestyle publication. Her work has appeared in a variety of print and online publications, including Consumers Digest, Dallas Style and Design, DS News and DSNews.com, MReport and theMReport.com. She holds degrees in journalism and art from the University of Georgia.

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