According to this report from the Quad Cities, Illinois home owners are being targeted by mortgage rescue scams that appear as offers for loan modification assistance from groups that claim to be associated with the Department of Housing and Urban Development (HUD). As the article points out, the alleged affiliation with HUD is a giant red flag that the offer is a scam.
Quite simply put, HUD is not in the business of offering loan modifications.
Other red flags include:
- Companies that ask for money up front.
- Companies that ask for your social security number or loan number over the phone.
- Companies that tell you to pay them directly.
- Companies that tell you to transfer your deed to them. Even if the company promises to sell the house back to you after a few years, this is absolutely a scam.
In Illinois, only a licensed attorney can request payment up front for a loan modification. Even then, be sure that you are also paying for the firm to defend your foreclosure in court. Just because an attorney's office is helping you obtain a loan modification, you still want your attorney to defend you during the foreclosure process. Obtaining a loan modification takes time. Failing to defend the foreclosure lawsuit decreases the amount of time you have to obtain a loan modification.