December 18, 2007 - FannieMae, one of the government backed companies that guarantees many private mortgages, is a fairly conservative organization. So it's a real sign of the times that the company has posted a video on YouTube telling consumers worried about foreclosure how to avoid mortgage scam artists.

FannieMae introduced the video after a survey by its sister company - FreddieMac - showed that 25% of homeowners who are delinquent on their mortgages search the internet for help before they ever contact their lender. These searches often direct troubled homeowners to the websites of companies that promise to help them avoid foreclosure.

While there are many organizations that will work with homeowners to help them get their debts under control, there are also many scam artists who want nothing more than to steal any equity that troubled homeowners may have built up in their homes. The scammers play on the fears of homeowners; often getting them to sign over the deed to their home.

Any homeowner who is unable to pay the mortgage should call his or her lender as soon as they realize there is a problem. That phone call should not just be to talk to a customer service representative. Instead, callers should insist on being connected to the lender's Loss Mitigation Department. It is this group that has the authority to work out payment plans. In some cases, they may even agree to change the terms of an existing loan or help consumers refinance into a new loan with better terms.

It is normal for any consumer placing such a call to be nervous. Keep in mind that the bank doesn't want to foreclose on anyone's home. In fact, becoming the landlord is probably the last thing that banks want. They are not setup to manage property. Because of the large number of homeowners currently facing foreclosure, lenders have good reason to work with troubled consumers.

Any consumer who is contacted by someone other than their lender who promises to get them out of financial difficulty should be very wary. Desperate consumers make good targets for scam artists. Just remember that any deal that sounds too good to be true probably is. More importantly, don't sign any documents without reading them thoroughly first. If you don't understand documents, get the opinion of an attorney.

Here is the FannieMae video. Just click on the arrow below to play it.

by Jim Malmberg

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