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Life situations change. Someday you may find yourself in a tight financial hole. You may even be facing foreclosure. Despite that type of stress, don’t be fooled by people who promise what they cannot deliver. Scammers are more than ready to take your money … and run.

Loan modification schemes are one approach used by disreputable people and firms to steal your money. A loan modification is a permanent change in your loan and can be used once every two years.

At Kerndt Brothers Bank, we use very specific criteria to determine who is eligible for a loan modification. Done right, a modification can help reinstate your loan and lower your payments.

Done wrong, however, a loan modification can ruin you. At Kerndt Brothers Bank, your financial security is our number one priority. We want you to know the warning signs so you can avoid fraud and protect your assets.

You should suspect a scam artist if someone …

  • Says they need to charge an upfront fee to work with your mortgage broker. Not only is this illegal, but it is immoral. No one can collect fees until they present a written offer that you accept. Don’t trust anyone based on his or her title alone. Loan modifications are free. If you pay this type of advance “administrative” fee, your money will magically disappear.
  • Guarantees they can modify your loan or stop your foreclosure. No one can make this promise. Brokers and counselors can try, but they can’t guarantee anything. Even is someone offers you a bells and whistles “money-back guarantee,” suspect a scam.
  • Tells you it’s okay to stop paying your mortgage company. They may also claim to represent the government. Until you have something in writing from a credible institution, don’t ever stop paying your mortgage loan. And certainly don’t send your mortgage payment to anyone but your current lender. If you’re having trouble paying your mortgage, call your lender immediately. For additional free information and help, you can also contact a counseling agency associated with Housing and Urban Development (HUD).
  • Begins pressuring you to sign over the title or deed to your home. Don’t do it. In addition, don’t sign any paperwork you don’t completely understand. Although you may be in a financial pinch, don’t rush anything. It’s far better to take a few extra days or consult someone else before you risk losing your home for good.
  • Claims to represent the government. It may be tempting to trust someone who offers “government approved” or “official government” modification loans, but things that seem too good to be true often are too good to be true. Contact your mortgage lender to see if they’re legitimate. While you’re on the line, ask your lender if you’re qualified to receive any type of government help.
  • Asks you for personal information or private financial information over the phone or online. Don’t fall for this scam. If you wouldn’t share this data with your neighbor, why would you disclose it to a stranger you’re never met? Share personal information only with your current mortgage lender or a HUD-approved representative.

Kerndt Brothers Bank has been your trusted financial partner for more than 150 years. We built our reputation by being honest and fair. Please contact us if you have any questions about loan modifications. We’re always here to help.

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The material provided on this website is for informational use only and is not intended for financial or investment advice. Kerndt Brothers Bank and/or its partners assume no liability for any loss or damage resulting from one's reliance on the material provided. Please also note that such material is not updated regularly and that some of the information may not therefore be current. Consult with your own financial professional when making decisions regarding your financial or investment management.