It is a sorry commentary on some opportunists in this country that they're taking advantage of folks who fear losing their homes in the current economic downturn as manifested by the mortgage crisis. Thankfully, the federal government is going after the rascals.
The scams, and that's what they are, go something like this: Companies with authoritative-sounding names, often implying they're somehow connected with President Obama's bailout plan, offer people help with loan modifications. They want an upfront fee of $1,000 to $3,000. And the modifications? According to federal officials, they rarely happen. "These are predatory schemes designed to rob Americans of their savings and potentially their homes," said Treasury Secretary Timothy Geithner.
The Federal Trade Commission is after these people, and so is the Department of Justice. Attorney General Eric Holder put it plainly: "If you prey on vulnerable homeowners with fraudulent mortgage schemes or discriminate against borrowers, we will find you and we will punish you." Amen, and amen.
Taking advantage of people's fears, using their vulnerability against them, is just about the sleaziest thing a scam artist can do. And Holder said mortgage fraud cases are up 400 percent from five years ago.
Things to look out for include fees up front (counseling is available from the government for nothing), guarantees that homes will be saved and boasts of an outrageously high success rate.
There are those caught in this mortgage crisis who may run out of options, and government efforts to help homeowners won't fix bad loans and joblessness and all the problems associated with them overnight. But many thousands of innocent bystanders should gain some satisfaction that Obama's administration at least intends to take out some of the trash blowing around the crisis. Or maybe that should be, put in some of the trash (in a container called jail).