Be Cautious when Hiring Loan Modification Providers

by admin on February 21, 2009

If you go searching for loan modification assistance you will find many businesses willing to help. You have to be careful though as performing a loan modification is not a regulated industry. Many of the people best equipped to help our former mortgage brokers and other people in the industry and they are lightly regulated. If anyone asks you for $4,000 upfront or some other large fee to do your loan mod, warning bells should be going off. I have talked to many bankruptcy lawyers and they can relate countless stories about people who ended up filing bankruptcy, but first got taken advantage of by a unscrupulous individual or company.

If you are looking to get help with your loan modification, make sure you get the fees for their work rolled into the loan or find out a way to pay them after the work has been performed. It’s not fair to yourself to shell out a lot of money and then get nothing in return because you got taken advantage of.

If you have the courage, there’s no problem with contacting your mortgage company yourself to inquire about a loan modification. You will want to write a hardship letter that outlines the difficulties you have had paying your mortgage. If you recently got laid off, had a death in the family, or went through a medical crisis, then include all that detail in your letter.

There’s no reason you can’t hire someone to do your loan mod, but understand what you’re getting into. There should be a contract for you to sign before any work gets started. Read the contract thoroughally and check for any hidden fees. Check with the Better Business Bureau to see if there have been any complaints against this company for their work. You can also look to find out if they are licensed to do business in the state you live in. Are they an LLC, S Corporation or a Public Corporation? It wouldn’t hurt to ask, the more you know the better you can feel with your decision.

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