Coalition Launches New Campaign to Fight Loan Modification Scams

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April 23, 2010
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Coalition Launches New Campaign to Fight Loan Modification Scams

Website Includes Form for Reporting Fraud and Database Listing Scammers

WASHINGTON, April 23 -- The Loan Modification Scam Prevention Network, led by Fannie Mae (NYSE:FNM), Freddie Mac, the Lawyers' Committee for Civil Rights Under Law and NeighborWorks America, today announced a national campaign to prevent loan modification scams through public education, complaint reporting and coordination with local, state, and federal enforcement agencies.

As part of the campaign, the Network has launched a consumer-friendly Website, http://www.PreventLoanScams.org, which is designed to support national, state and local law enforcement efforts. The Website serves as a nationwide clearinghouse and destination for loan modification scam information on complaints filed, laws and regulations, and enforcement actions.

  The Website includes:
  --  An electronic complaint form that can be filled out easily by an
      individual who has been scammed or by counselors or friends helping a
      victim of fraud;
  --  Names of individuals and organizations who have been identified by
      enforcement agencies to have allegedly committed a loan modification
      scam;
  --  Information on how to avoid a loan modification scam;
  --  State-by-state information about rules, regulations and resources
      available to homeowners; and
  --  News and information on enforcement efforts.

Homeowners who believe they may have been a victim of a loan modification scam, can also call the Homeowners Hope Hotline at 888-995-HOPE to log a complaint and to receive free foreclosure prevention counseling.

"We've joined forces with government agencies and other industry leaders to help fight loan scams across the country," said Jeff Hayward, Senior Vice President, Fannie Mae.  "This effort links homeowners to free, legitimate counseling and helps to put scammers out of business.  The goal of this campaign is to educate homeowners and empower those who have fallen victim to scammers to report and prevent future fraud."

"By working together we can help the public identify alleged loan modification scam artists, learn how these scams work, and give them a new way to fight mortgage fraud," said Senior Vice President Hollis McLoughlin, Freddie Mac. "The Network's new website form will enable citizens to report fraud artists to law enforcement agencies before other borrowers are swindled out of their homes."

Loan modification scams are schemes in which people take advantage of vulnerable homeowners.  Scammers prey on homeowners in distress by guaranteeing to help the homeowner obtain a modification of their mortgage to save their home.  Frequently, the borrowers pay money up front but receive no help at all and their home is lost to foreclosure.

"Receiving complaints about loan modification scammers throughout the country is crucial to supporting enforcement efforts," said Joseph Rich of the Lawyers' Committee for Civil Rights Under Law.  "By encouraging homeowners to take action and report fraud to the Loan Modification Scam Prevention Network, we hope to help federal, state and local enforcement officials bring actions against scammers."

"We're pleased to be a part of this coalition, which complements and supports our ongoing efforts to educate consumers about the warning signs of loan fraud," said Marietta Rodriguez of NeighborWorks America. "We want homeowners to know they have a place to turn to if they think they are being scammed."

"It's a real shame to hear stories from consumers who are already financially struggling and who learn they have paid large amounts of money, unwittingly, to a loan modification scam organization," said Josh Fuhrman, Vice President for Programs of the Homeownership Preservation Foundation.

  Key partners include:
  --  U.S. Department of the Treasury
  --  U.S. Department of Housing & Urban Development
  --  Federal Trade Commission
  --  Department of Justice
  --  Federal Bureau of Investigations
  --  Federal Deposit Insurance Corp
  --  Office of the Illinois Attorney General
  --  National Association of Attorneys General
  --  Conference of State Bank Supervisors
  --  HOPE NOW Alliance
  --  National Fair Housing Alliance
  --  National Urban League
  --  National Council of La Raza
  --  National Coalition of Asian Pacific American Community Development

For more information, including additional national and local partners and tips on how to avoid and report scammers, please visit http://www.PreventLoanScams.org or call the Homeowners Hope Hotline. 888-995-HOPE (4673).

About Fannie Mae

Fannie Mae exists to expand affordable housing and bring global capital to local communities in order to serve the U.S. housing market. Fannie Mae has a federal charter and operates in America's secondary mortgage market to enhance the liquidity of the mortgage market by providing funds to mortgage bankers and other lenders so that they may lend to home buyers. Our job is to help those who house America.

About Freddie Mac

Freddie Mac was established by Congress in 1970 to provide liquidity, stability and affordability to the nation's residential mortgage markets. Freddie Mac supports communities across the nation by providing mortgage capital to lenders. Over the years, Freddie Mac has made home possible for one in six homebuyers and more than five million renters.

About the Lawyers' Committee for Civil Rights Under Law

The Lawyers' Committee for Civil Rights Under Law (LCCRUL), a nonpartisan, nonprofit organization, was formed in 1963 at the request of President John F. Kennedy to involve the private bar in providing legal services to address racial discrimination. The principal mission of the Lawyers' Committee is to secure, through the rule of law, equal justice under law, particularly in the areas of housing, community development, employment, voting, education and environmental justice. For more information about the LCCRUL, visit http://www.lawyerscommittee.org .

About NeighborWorks America

NeighborWorks® America creates opportunities for people to improve their lives and strengthen their communities by providing access to homeownership and to safe and affordable rental housing. NeighborWorks® America is the nation's leading trainer of community development and affordable housing professionals.  For more information, go to http://www.nw.org.

About Homeownership Preservation Foundation

Founded in 2004, the Homeownership Preservation Foundation (HPF) is a 501(c)(3) independent national nonprofit dedicated to reducing foreclosures and preserving homeownership for American homeowners.  HPF provides comprehensive foreclosure prevention counseling service available for free in over 160 languages to homeowners by calling 888-995-HOPE(TM) or visiting http://www.995hope.org.  For more information about the Homeownership Preservation Foundation or the Homeowner's HOPE(TM) Hotline, visit http://www.995hope.org

Source: Fannie Mae
   

CONTACT:  Amy Bonitatibus of Fannie Mae, +1-202-752-4144

Web Site:  http://www.fanniemae.com/

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