This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

Don't Let Loan-Modification Firms Scam You

Homeowners struggling to pay their mortgages have been taking advantage of the government's new loan-modification program. Unfortunately, so have scam artists.

The effort has given rise to a slew of loan-modification companies that target the more than 5 million homeowners behind on their payments. Some of them are legit, but many aren't. They usually charge a few thousand dollars for their work. What borrowers don't realize is they can complete the process themselves for free.

To get started, contact your lender. The lender is the only company with the authority to change your loan terms. The process will be similar to when you applied for your mortgage. You will need to provide financial documents and a letter that explains your economic hardship.

Loan-modification companies argue that the process can get complicated and they can save time and prevent frustration. But this convenience is pricey, especially for people who can't afford their payments. If a company charges $3,000 for a loan modification, that's like paying $25 an hour for 120 hours of work. You can complete the entire process in far less time.

It's also important that you fully understand your new loan terms. By going through the modification process yourself, you will be more familiar with what you're signing. It will also give you the opportunity to ask questions and avoid surprises.

There's also free help available from the U.S. Department of Housing and Urban Development and through the Homeownership Preservation Foundation Web site.

1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Try it NOW
Only $9.95
Try it NOW
14-Days Free
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
AAPL $125.17 -0.95%
FB $83.30 0.13%
GOOG $553.95 0.35%
TSLA $191.00 0.23%
YHOO $44.95 0.00%


DOW 17,863.70 -112.61 -0.63%
S&P 500 2,075.53 -10.71 -0.51%
NASDAQ 4,920.1210 -27.32 -0.55%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs