Creation of a multi-agency task
force was announced on Thursday designed specifically to deter scam artists
preying on homeowners looking for help under the Home Affordable Modification
Program (HAMP). The task force will
operate under the auspices of the Department of the Treasury, the new Consumer
Financial Protection Bureau (CFBP) and the Office of the Special Inspector
General for the Troubled Asset Relief Program (SIGTARP.)
SIGTARP, the CFPB, and Treasury will
investigate mortgage modification schemes, among other things, in which
companies charge struggling homeowners a fee in exchange for false promises of
lowering the homeowner’s mortgage debt or payments through HAMP.
Simultaneous with the announcement
of its creation, the task force issued a consumer fraud alert to protect
homeowners from HAMP-related mortgage modification scams. The alert tells homeowners who are struggling
to make their mortgage payments to be aware of con artists that promise to save
their homes and lower their mortgage debt or their payments and offers these
homeowners specific tips:
No special assistance is needed to
apply for a HAMP modification and paying a third party does not improve your
likelihood of obtaining one. Beware of
persons claiming to be HAMP experts.
Homeowners can make application on their own or with the help of a Housing
and Urban Development (HUD) approved housing counselor. Applying for the program is always free.
No third party can approve a
modification; this can only be done by the loan servicer.
No advance fee is necessary for
mortgage modification services and in most cases charging in advance for a
modification is illegal.
Homeowners should verify the
authenticity of any individual or company that claims to
be affiliated with HAMP or displays a seal or logo representing the U.S.
government by calling the Homeowner’s HOPETM Hotline.
Beware of individuals or companies
that offer money-back guarantees or that advise stopping mortgage payments or
not contacting the mortgage servicer.
The alert stresses that troubled
homeowners can avoid scams by working with a HUD-approved housing counselor to
understand their options and provides information for contacting both HAMP and
an approved counselor.
“The goal of our consumer fraud alert is to
empower homeowners with the knowledge of how to recognize and avoid these
scams,” said Christy Romero, Deputy Special Inspector General for
SIGTARP. “These scams prey upon the most vulnerable homeowners as they
desperately hold out hope of saving their homes. SIGTARP, the CFPB, and
Treasury want to make sure that homeowners know a scam when they see one and
know where to turn for help. SIGTARP will work with the CFPB and Treasury
in this joint task force and with other law enforcement partners to shut down these
scams and to ensure that the perpetrators pay for their crimes.”