If you are a homeowner having trouble making mortgage payments, be very careful of anyone who claims they can save your home from foreclosure. This is an area rife with scammers looking to take advantage of desperate homeowners.
Red Flags
Someone who asks you to do any of the following is attempting to scam you and should be reported (as described below):
- Pay for assistance in advance.
- Upfront fees for loan modifications or forbearance are prohibited by California law, except by attorneys.
- Do not pay an attorney without verifying their license, doing thorough research, and obtaining an agreement that outlines what services will be performed.
- Send payments to someplace other than your mortgage servicer.
- Scammers often tell you to let them handle the payments and communication with your mortgage servicer.
- Scammers usually want you to pay with cashier’s checks because it is harder to reverse the transactions.
- Sign documents transferring the deed of your property or sign any documents you don’t understand.
- Scammers will often assure you the papers are no big deal and urge you to sign quickly, before you have time to consult with anyone else or reconsider.
- Don’t rely on what the representative tells you. Before signing any document, make sure you understand what it says and how you will be affected. Ask someone else to read over it if needed.
Reporting scams
- Call 888-995-HOPE (4673) to report a suspected scam and to get mortgage help.
- File a complaint with the Federal Trade Commission (FTC) [http://www.ftc.gov/complaint], the nation’s consumer protection agency.
- Submit a complaint to the Consumer Financial Protection Bureau (CFPB) [https://www.consumerfinance.gov/complaint/].
Foreclosure assistance
If you are at risk of foreclosure, visit Making Home Affordable [https://www.makinghomeaffordable.gov/], a federal website with a link to information on HUD-approved housing counselors, who provide free foreclosure prevention counseling. A HUD-approved counselor can help you understand your rights and options.
COVID-19 pandemic-related financial hardship
If you have fallen behind on mortgage payments due to a financial hardship related to the COVID-19 pandemic, you may get relief through the California Mortgage Relief Program. You may be eligible even if you didn’t have COVID-19—for example, if you lost your job or had reduced income due to the shutdown. If you qualify, the program will issue a payment directly to your mortgage servicer to help you catch up on your payments. This is a one-time grant that does not have to be paid back. Visit the California Mortgage Relief Program web page to find out if you are eligible.