Thursday, November 18, 2010

Loan Scam Alert Campaign Reaches Millions of New York Residents With DMV Partnership

New Yorkers visiting their local Department of Motor Vehicles (DMV) office will now be alerted to the dangers of loan modification scams through a poster campaign at DMV offices in each of New York's 62 counties. The poster, developed by the national Loan Scam Alert public awareness campaign and distributed in partnership with the NYS Department of Motor Vehicles, the NYS Consumer Protection Board and NeighborWorks America, warns homeowners of the three top signs of loan scams and directs them to and 888.995.4673 for information and assistance.

Approximately 10 million customers visit DMV offices every year, providing an unprecedented opportunity to help protect New Yorkers from falling victim to scams. Although the state’s foreclosure rate has consistently been in the middle range nationally, New York State ranks second in the number of homeowners who report being victimized by scammers.

“I am pleased that the DMV is able to assist the Consumer Protection Board in making the public more aware of potential loan modification scams,” said DMV Commissioner David J. Swarts. “It is our hope that increasing public awareness about the warning signs that a loan modification proposal may be a scam will result in fewer New Yorkers putting their homes in jeopardy.”

The NYS Consumer Protection Board, under the leadership of Chairperson and Executive Director Mindy Bockstein, has actively promoted the Loan Scam Alert campaign since it was launched a year ago, helping to bring its key messages to homeowners through a series of events, press conferences and media interviews. The Consumer Protection Board’s logo appears on each of the posters.

“The current economic climate has provided fertile ground for con artists who seek to take advantage of desperate and distressed homeowners,” said Bockstein. “That’s why we’re partnering on this campaign and eliciting help from key organizations like the Department of Motor Vehicles to alert New Yorkers to the dangers of loan modification scams. If you’re having difficulty meeting your mortgage obligations and are facing foreclosure, be mindful of the red flags and aggressive tactics that may indicate suspicious activities. We urge you to access free foreclosure counseling services instead of going to a for-pay company which may actually accelerate foreclosure by making big promises but doing little or no work, redirecting mortgage payments or taking title to your home.”

The top three signs of a loan modification scam are:

  • A company or individual asking for a fee in advance
  • A company or individual who guarantees they can modify a loan
  • A company or individual who asks that you stop paying your mortgage and pay them instead

Scammers typically charge several thousand dollars, and then do little or no work, leaving homeowners even further behind. Homeowners believe their case is being resolved and only learn from their mortgage company that no contact has been made on their behalf. By then the scammers have long disappeared.

“Knowledge is the best defense against loan modification scams,” said Deborah Boatright, northeast district director, NeighborWorks America. ”With the help of our partners at the NYS Consumer Protection Board and the NYS Department of Motor Vehicles, New Yorkers throughout the state are more aware of the dangers of scams and know where to go for free, trustworthy assistance.”