Hiring an Amateur to do Your Loan Mod Could be a Big Mistake

by admin on February 25, 2009

There is an explosion of interest these days in loan modifications. With President Obama’s announcement of the Foreclosure Prevention Program many out of work former mortgage brokers and even lawyers in other practices are jumping in and calling themselves loan mod experts. There are a number of ways you can safeguard yourself against this dramatic increase in loan modification specialists – here are a few good tips:

1) Make sure that the company you are considering hiring has a valid business license within the state you live. You’d be amazed at how many companies do business and don’t even have a license to show for it.
2) Is the loan mod company going to file legal documents for you? If so make sure they are licensed attorneys. There are many people that try to masquerade as lawyers and do not have the necessary license to practice law.
3) Are you being asked for exorbitant up front fees? If a business or individual is demanding $5,000 upfront to do your loan mod, warning bells should be going off. Why do they need that much? Can’t it be paid out over the process? It’s possible you may have to pay an upfront retainer or fee, but you shouldn’t be shelling out huge sums of money before any work is done.
4) Ask for references. This is a very important step as a reference can tell you whether or not the person was successful getting a loan mod done. Some attorneys may be better at dealing with certain lenders. For example suppose you went to a lawyer who specialized in doing Countrywide loan modifications, but you had a Chase mortgage – you may want to think twice about getting your work done by this Countrywide specialist.
5) Check online to find out if there is any bad press about the company you are considering hiring. Doing a simple Google search may turn up good or bad press and it could only take you 15-20 minutes to do some snooping around. Check out different loan forums to see if other people have hired this company before. It’s very insightful to do a little homework – it could save you money and heartache in the long run.
6) If you think you’ve been scammed by a loan mod company, you have recourse. Write a letter to your state attorney’s general office describing your situation. There may be others like you that fell victim to an unscrupulous invidivual or business and there may be something the authorities can do about it.

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