HUD warns homeowners about mortgage scams

PROVIDENCE—The federal government warned consumers Monday to be aware of scams that promise to keep homeowners from losing their homes.

Rhode Island ranks 10th in the nation when it comes to home foreclosures. With more people trying desperately to stay in their homes, officials said it’s becoming easier for scam artists to prey on them.

The U.S. Department of Housing and Urban Development said homeowners should be wary of any program that offers a quick fix in exchange for money up front.

“Beware of any person or organization that asks you to pay a fee in exchange for housing counseling services or modification of a delinquent loan,“ said Nancy Smith-Greer of HUD.  “Do not pay. Just walk away.“

HUD had these tips for homeowners: never sign over a deed to someone unless you are working directly with your mortgage company to forgive your debt, never send mortgage payments to someone else without the mortgage company’s approval, and beware of solicitations that appear to be coming from the government.

“Government agencies are not soliciting your business. They are waiting for you to come to them,“ said Richard Godfrey of Rhode Island Housing.

Officials said not all companies that charge a fee for housing counseling are scams, but they said there are many agencies locally that can help you for free.

Rhode Island has 12 HUD-approved counseling agencies that will work with people on housing issues free of charge.