Today Loan Modification Fraud -- Homeowners Should Beware.

You might be finding it hard to pay your monthly mortgage because of the troubled economy

, falling real estate values or changes in your personal finances or a combination of these. Whatever the cause of your financial difficulty, you need to investigate a loan modification. You might be so desperate you feel like grabbing on to whatever help you can get and working with the first company that promises you hope. Be careful. Loan modification scams do exist and may end up adding to your financial burden rather than relieving it.

You need to understand that a loan modification is a legitimate, acceptable option. The lender will decide if they will work with the homeowner on adjusting the terms of the loan so they are more affordable. President Obama has just introduced the Making Home Affordable plan, earmarking $75 billion to modify the loans of 4 to 5 million homeowners in the United States.

Homeowners first need to talk to a financial counselor before starting the loan modification process. The counselor will give advice to the borrower and act as his representative, helping him get what he needs from the modification. There are counselors approved by the HUD who do not charge for their services and are very reliable companies.

There are also loan modification companies that charge for their services and make a profit. These companies have recently increased dramatically since the decline of the housing market. Some of these companies are legitimate but some are not, they are fraudulent. You need to be very careful about paying someone to work on your behalf.

Here are some things that you will find in a legitimate loan modification company:

1. It has a solid reputation that is supported when you do a Google search; contact the Better Business Bureau, the Federal Trade Commission and/or the Consumer Protection Agency.

2. It offers a 100% refund if you do not get the results you were seeking in terms of a loan modification or an acceptable alternative.

3. Everything is explained to you in great detail, including the reason for each fee.

4. You can visit a brick and mortar office as opposed to simply conducting business online.

With some research and a lot of careful investigation, it is possible to find a loan modification company that will get you out of your financial difficulties. There are honest, trustworthy companies that do charge fees for their services but there are also many who are scams so you need to exercise caution. Do not work with companies who don't offer guarantees if you are not happy, who charge large fees when you are getting started or ones how just give you a bad feeling.

Obtaining a loan modification is very possible for homeowners who are facing financial difficulties, but don't fall for a scam. Learn to look for the signs that the company you are dealin

by: Yasmin Taufk

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