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.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV