Online mortgage relief scams shut down

November 22nd, 2011

The government has shut down online mortgage modification scams that allegedly lured their victims through several search engines. The Special Inspector General for the Troubled Asset Relief Program (SIGTARP) has shut down 125 alleged mortgage relief scams that advertised on Google, Yahoo! and Bing.

The companies charged homeowners to help them with troubled mortgages through the government's Home Affordable Modification Program (HAMP).

Cutting off advertisers

Microsoft, which founded Bing and powers Yahoo!, suspended advertising relationships with more than 400 Internet advertisers and agents associated with the the alleged online mortgage fraud schemes. It also blocked all future advertising associated with the 125 scams. Google suspended advertising relationships with more than 500 Internet advertisers and agents associated with 85 of the alleged scams.

Upfront fees demanded by scammers

Reportedly, scammers convinced homeowners to pay upfront fees, then instructed them to stop making mortgage payments to lenders. They also persuaded homeowners to divert mortgage payments to them, transferred property deeds illegally and accessed sensitive financial information. Some of the websites that lured troubled homeowners claimed to be affiliated with the government.

According to Christy Romero, deputy special inspector general for SIGTARP, many homeowners who fell prey to these scams were enticed by web banner ads and online search advertisements. These ads promised, for a fee, to help lower mortgage payments.

"SIGTARP's work in cutting off these Internet advertisements will immediately and dramatically decrease the scope and scale of these scams by limiting their ability to to seek out and victimize struggling homeowners, " she said in a press release. "SIGTARP will investigate and hold accountable criminals who defraud homeowners in connection with HAMP, while doing everything we can to stop homeowners from becoming victims in the first place."

Get help with troubled mortgage

If you are dealing with a troubled mortgage, don't pay these companies upfront fees or give them private information. Contact your mortgage lender or servicer directly, or look for help on the government's website. Mortgage calculators can help you run some of the numbers see how much a modification may help.

And if you're having trouble meeting your mortgage payments, modifications aren't the only way to go. Don't forget about refinance options, such as a Home Affordable Refinance Program (HARP) refinance, which may lower your monthly payments as well. Use refinance calculator to estimate how much you might save by refinancing.

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