DRE: We are currently investigating 250 “loan modiification scam” cases
The California DRE warns consumers to be careful of company’s asking for upfront fees, which are only allowed for certain licensed companies. It lists 145 companies that have “submitted advance fee agreements for loan modification and/or similar services to the Department of Real Estate for review, and have received “no objection” letters regarding their use.” That number has jumped from less than 25 just sixty days ago, an indication of just how many folks are looking to profit from the modification game. There is “no objection” if the companies are run by a licensed real estate broker or a licensed attorney.
“I wouldn’t say they are all legitimate,” says Tom Pool of the DRE. The California DRE alone is currently investigating 250 open cases, looking into loan mod scams. It’s already shut down several.
Still, as I said, many of these companies are legitimate, but you might ask, if banks are supposedly getting so aggressive in trying to help troubled borrowers, and Fannie [FNM 0.74 0.11 (+17.46%) ] and Freddie [FRE 0.72 0.07 (+10.77%) ] are ramping up their efforts as well, not to mention all the non-profits out there trying to help, why do you need to pay these companies for a service that should be provided by your lender for free?
