hummingbird loans installment loans long term modifications were created in order to offer the struggling home owner another option in dealing with the possibility of foreclosure. They are permanent changes in one or more of the terms of your hummingbird loans tribal lenders installment loans. The most common changes include lowering the interest rate and payment, extending the number of years, adding arrears to the balance, and on very rare occasion, reducing the principal loan balance. However, as with most things that were created to help people, there are those self-serving, greedy individuals that prey on struggling home owners in the guise of being the savior for their home. In this article, I'll explain how the scam works. In the next installment, I'll explain how to avoid them.

One very effective scam preys on the desperate home owner's need for a guarantee. This, to me, is the most contemptible way to do business. The company gets a hold of your already tattered emotions and uses fear of loss (of service fee and home) to convince you that you cannot use the services of a law firm that cannot give you a guarantee of some sort. If you are told that there is a guarantee of result, RUN!!! Because just like any service you'd pay a legitimate law firm for, no attorney can ever legally guarantee outcome. There are simply too many variables! When you retain an attorney to represent you in any situation, including a loan modification request to your lender - that is exactly what you are paying for - the service of representation - NOT the result.

Here's how the scam works. You pay the fee, usually $2,000 - $5,000 (which is typical in California). The company guarantees that if they cannot secure a loan modification acceptable to you (regardless of how unreasonable your criteria) within 3 weeks, they will refund 75% of your fee immediately without hassle. The 25% will cover administrative and processing fees. That sounds like a pretty good deal, right? Well, it would be IF the intention was there to actually render the service to its completion.

First of all, your terms need to be attainable and qualified. For example, if you need a 4% fixed rate for the life of the loan to be able to afford your home, then you cannot afford your home. End of story. Also, most hummingbird loans bad credit payday loans direct lenders no credit check modifications take at least 30 - 60 days from submission, for the lender to complete, due to lack of staffing. But this modification service will basically agree to anything because they have no intention of actually performing a legitimate legal service. They send out a few letters possibly on attorney letterhead, on your behalf, to your lender (which you could do yourself) requesting a change in terms based on your criteria - regardless of your ability to qualify for the modification. OH! Yeah! You DO have to qualify for the modification according to the lender's guidelines.

Then, when the contracted 3 weeks is up, you promptly get a refund of $1,500 - $3,750. The company retains $500 - $1,250 for sending out a few letters. That's a very effective way to embezzle a tremendous amount of money from the struggling public. Imagine yourself paying $500 - $1,250 just to send out a few generic form letters, then wait the contracted amount of time until you are told that the lender would not agree to the terms. You actually DO get what you pay for - a guarantee that you will receive a refund! In all likelihood, the lender, being inundated with so many loan modification requests never even saw your request as REAL.

The worst part about this whole scam is that there is not much the authorities can do about it. You enter into a binding contract with specific actions to be performed. The company performs them. They did not secure the modification you were seeking so they refund the fee less their processing and administration fee. Pretty cut and dry. No wrong-doing here - except in the company's intention. And it's very difficult to prove intention except in the accumulation of many cases that happened the same way. So your best defense is to BEWARE and don't retain a law firm that guarantees a particular result.

Lynette M. Domingo

CA Department of Real Estate Broker

CA Department of Insurance Broker-Agent

Nationally Certified Fitness Instructor

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