Attorney General Kamala D. Harris Issues Consumer Alert on Mortgage Loan Modification Scams

LOS ANGELES — Attorney General Kamala D. Harris issued a consumer alert today to warn homeowners about mortgage loan modification scams.  The California Department of Justice has received an increased number of complaints from homeowners and has also been contacted by mortgage servicers that have expressed concern about these scams.

Scammers are calling and mailing homeowners, pretending to be their mortgage servicer or a representative from the Home Affordable Modification Program (HAMP), to offer fake loan modifications and “trial payment plans” to lower mortgage payments.  These scammers may send genuine-looking letters with the logo of the homeowner’s mortgage company, the homeowner’s account number, and deceptive contact information that routes homeowners to the scammers instead of their mortgage servicer.  They may also call from telephone numbers that show up on caller ID as the homeowner’s mortgage company.

As with legitimate HAMP offers, homeowners are told that their loans may be permanently modified if they make three trial period payments and follow certain other requirements.  Homeowners are usually instructed to send payments via wire transfer or money order to sham addresses that supposedly belong to their mortgage company, only to later discover that they have been sending payments to scammers and have lost thousands of dollars while their real mortgage company has not received any payment during the duration of the scam. Currently, the federal HAMP and HARP programs are set to end on December 31, 2016.[1]

Other common mortgage modification scams include:

  • Illegally charging homeowners upfront fees for mortgage modification services and then providing little or no assistance;
  • Falsely guaranteeing or implying that modification applications will be approved (often through falsely claiming affiliation with HAMP, other government programs, or mortgage servicers); and
  • Tricking homeowners into transferring part or all of their property interests to a scammer, usually in an effort to drain equity from a property.

Important Tips

Homeowners should keep the following tips in mind to protect themselves from mortgage modification scams:

  • Be wary of unsolicited telephone calls and mailings that offer a mortgage modification or claim to be a pre-approved modification, especially if the homeowner is asked to provide any payment or personal information.
  • Homeowners who have applied for a mortgage modification should confirm any modification offers or approvals directly with their mortgage servicer to ensure that the modification offer or approval is legitimate before paying money or providing personal information.
  • Because scammers may provide fake contact information, homeowners should contact their mortgage servicer using the contact information on their regular mortgage statements to make sure that an offer or approval is legitimate.  If the offer or approval is for a HAMP modification, homeowners can also call the federal government’s Making Home Affordable hotline at 1‑888-995-HOPE (1-888-995-4673) to confirm that the offer is legitimate.
  • Scammers often request payment by money transfer companies, including Western Union and MoneyGram, or wire transfer, and may also use a fake address for payments.  Before sending a mortgage payment to any address other than what is on the regular mortgage statements, homeowners should verify that the address is legitimate with their mortgage servicer.
  • In California it is illegal for any person, including real estate agents, real estate brokers, and lawyers, to charge upfront fees for loan modification assistance or services.[2]  Be wary of any individual or company that guarantees a successful result, since only the mortgage servicer can approve a mortgage modification offer.  Homeowners should also be wary of any individuals who encourage homeowners to stop contacting their mortgage servicer or to stop making mortgage payments.
  • Homeowners should not have to pay a fee in order to apply for a mortgage modification and can get FREE help from a U.S. Department of Housing and Urban Development (HUD)-certified housing counselor to apply for a modification or other relief.  See Additional Resources below.

Additional Resources

  • To check the legitimacy of a HAMP offer or approval, report a suspected scam, or to get free mortgage loan assistance, call the Making Home Affordable hotline at 1-888-995-HOPE (1-888-995-4673) or go to
  • If a fake HAMP offer or approval is received, report it to the Office of the Special Inspector General for the Troubled Asset Relief Program at 1-877-SIG-2009 (1-877-744-2009) or go to
  • If a fake modification offer or approval is received by mail, report it to the United States Postal Inspection Service at 1-877-876-2455 or go to
  • For a referral to a free housing counselor approved by the U.S. Department of Housing and Urban Development (HUD), call 1-800-569-4287 or go to
  • For free assistance for low- and moderate-income Californians who want to stay in their homes and maintain an affordable mortgage, call Keep Your Home California at 1-888-954-KEEP (1-888-954-5337) or go to

To submit a consumer complaint about a mortgage loan modification scam to the Office of the Attorney General, visit


[2] See SB 94, passed in 2009, and 16 C.F.R. Part 322