By Jim Donovan
PHILADELPHIA (CBS) — They use half-truths and outright lies and promise relief to homeowners in distress. But the services they sell could leave you in worse shape than when you started. 3 On Your Side Consumer Reporter Jim Donovan has an important warning for homeowners about the latest mortgage scam.
It was a letter in the mail that first got the attention of Darlene and Franklin Whitehead. It was from a company called Save Your Home Mortgage Protection. The letter suggested that the couple’s mortgage may have been predatory and explained that company auditors could review their loan paperwork to see if their bank had violated any laws. This type of audit is often referred to as a forensic mortgage loan audit. Darlene says, “It was supposed to uncover everything all the lenders had been doing to us, and all of the hidden fees.”
Darlene says she pays her mortgage on time, but was told by the representative of Save Your Home that a forensic audit could help her get a lower interest rate, or even reduce her principal. But first she had to pay $2500 for the service. She says, “The four installments were $625. He said I’ll take cash, I said no, we’ll do a check.”
But after making her 3rd payment Darlene became suspicious. She says, “They weren’t answering my calls, their phone was always full, and I said what kind of business is this if the phone is going to be full”.
When Darlene called her mortgage lender they had no record of a loan modification request. That’s when she contacted 3 On Your Side. According to Darlene, “I put too much into this house, I’m not going to lose it.”
In fact The Federal Trade Commission says that there’s no evidence that a forensic audit will help modify a mortgage in any way. According to the FTC it’s just a scam to exploit financially strapped homeowners.
“You don’t have to have to pay anybody any money to save your home,” says Renee Borstad, head of the Department of Consumer Affairs for Burlington County, N.J., the county where Save Your Home Mortgage Protection operates. One problem though, the company isn’t licensed. Borstad says, “You have to be, there’s a debt adjuster license and you can’t act as a banker. These licenses are very important in the state.”
When 3 On Your Side contacted Save Your Home they refunded the Whitehead’s money almost immediately. An employee showed up at their house with $1875 cash. But when we visited their Mt. Laurel office, no one was to be found.
It seems Darlene was one of the lucky ones as sources tell CBS 3 that Save Your Home has closed up shop. It’s also believed that they may be operating under other names.
So what is the bottom line? If any person or company asks you to pay an upfront fee to conduct a so-called forensic audit on your mortgage or to help you obtain a mortgage modification, walk away.
For more information from the Federal Trade Commission about forensic mortgage audits visit:
To report a complaint related to a mortgage rescue scam or a forensic mortgage loan audit scam visit:
For FREE counseling on how to obtain a mortgage modification or assistance from your bank visit in lowering your mortgage payments visit: