HPF’s anti-scam hotline, which can be reached by calling our Homeowner’s HOPE Hotline at 888-995-HOPE, receives hundreds of calls each week from homeowners who believe they may have been victims of a loan scam. The stories our anti-scam counselors hear are heartbreaking – people borrowing money from family members to pay a scam organization that disappears overnight, or mortgages falling into default as a homeowner allocates next month’s mortgage payment for a promised modification, later discovering that their lender was never even contacted. Many of these real-life tales are featured on the website of the Loan Modification Scam Alert Campaign, an awareness initiative launched by NeighborWorks America in partnership with HPF and other housing affiliates.

The most important tip to know to avoid foreclosure avoidance scams? If a person or organization asks for an upfront payment, beware! Asking for advance fees for loan modification services is ILLEGAL and a telltale sign of a scam. While lawyers are technically allowed to charge a retainer in advance of legal services, note that around half of reported scam activity involves attorneys or individuals claiming to offer “legal services.” Another major warning sign is a company or person guaranteeing to stop a foreclosure; in fact, no one other than your lender can guarantee that you will be able to avoid a foreclosure. A more detailed list of scam warning signs is available on the HPF website by clicking here.

If you believe you have been the victim of a scam, please call the Hotline at 888-995-HOPE (4673) to report it. The information you share with our anti-scam team will be used by law enforcement agencies as part of their investigation into these organizations.

Indeed, we’ve seen a whopping 60 percent increase in calls from homeowners reporting suspected loan scam activity in the last year alone.  A number of them take advantage of federal relief programs as their “hook” to reel in unsuspecting victims resulting in homeowners paying an average of nearly $3,000 to a scam artist.

As Colleen Hernandez, our CEO, recently reported:  “Regretfully, every new government initiative spawns a slew of foreclosure avoidance scams, often from the same cast of characters doing business under various names to avoid easy detection and identification.  Most of these scams involve individuals supposedly offering mortgage foreclosure avoidance assistance that trained HPF counselors provide at no cost.  Make no mistake:  these are scammers.  They are quick to make empty promises to guarantee loan modifications or foreclosure avoidance and even quicker to take homeowners’ money.  As the Consumer Financial Protection Bureau warns, “If it sounds too good to be true, it probably is.”

Some of these scammers even try to hijack our name and logos to fool vulnerable borrowers in need of mortgage assistance.  Don’t be fooled — the only number to call to reach HPF for counseling assistance is the Homeowner’s HOPE Hotline at 888-995-HOPE.

Protect yourself.  Know the warning signs of potential mortgage scams, which we’ve posted here.