consumer alerts regarding unlicensed companies advertising loan modification services to Washington residents.
Homeowners seeking a loan modification should always check the licensing status of companies with DFI before doing business with them.
Tips for Protecting Yourself from a Loan Modification Scam
- Work Only with Licensed Individuals and Companies
Make sure you’re dealing with a licensed individual. Companies and individuals must be licensed under Washington’s Mortgage Broker Practices Act, or Consumer Loan Act, before offering to modifying your loan, or taking money from you. Verify a license with DFI at www.dfi.wa.gov or by calling 1.877.RING DFI (746-4334).
Some companies claim they do not need to be licensed in Washington because they are licensed in another state. This is not true.
- Work Only with Licensed Attorneys
Some companies also claim they don’t need a license because there is an attorney involved in the process. That alone is not an exemption from licensing. Attorneys from other states must be licensed to practice law in Washington if they are providing you with legal advice. Verify their law license with the Washington State Bar Association at www.wsba.org.
- Read and Understand All Documents
Be sure to carefully read and understand any documents you are asked to sign. Do not sign anything you do not understand.
- Refuse to Allow Direct Access to Checking Accounts or Credit Cards
Protect your money and refuse to allow direct access to your accounts.
- Consider Your Options
You can contact your lender yourself to seek a loan modification.
Also, consider taking advantage of free homeownership counseling to see if you qualify for other types of mortgage assistance. Visit www.homeownership.wa.gov for more information.