Qualified homeowners who are “under water” on their mortgages will have the opportunity to refinance under the Home Affordable Refinance Program (HARP) starting December 1st. Better Business Bureau (BBB) is warning consumers that while banks and mortgage companies are preparing for the rush of applications, they aren’t the only ones and scammers are also gearing up.
President Obama announced changes to the Home Affordable Refinance Program in October of 2011 to allow homeowners whose home is currently worth less than their mortgage, the ability to refinance at lower interest rates. The new HARP rules apply to homeowners who are current on their payments and whose loans are owned or guaranteed by either Fannie Mae or Freddie Mac. Some lenders began accepting applications December 1st, although many will take a few weeks or even months, to roll out the program. More than one million borrowers are expected to apply for the program, according to the Federal Housing Finance Agency, which oversees the two major mortgage-lending programs.
“Whenever there is a new or updated government program that may be a bit confusing, scammers come out of the woodwork to take advantage of that confusion,” said Matthew Fehling, President/CEO of BBB. “Already, there are websites claiming to be able to help homeowners through the HARP process, but not all have the consumer’s best interest in mind.”
BBB is warning homeowners who are thinking of applying for HARP to consider the following:
· Talk to your lender first and be wary of anyone who tells you not to contact your lender, a lawyer or a credit counselor.
· Never make payments to anyone other than your lender. If working with a company, be suspicious if asked to pay with a cashier’s check or through a wire transfer for services.
· Don’t pay upfront fees to anyone promising to provide counseling, take care of your paperwork, or stop the foreclosure process.
· Never sign over your deed, or allow yourself to be pressured into signing a document you don’t understand.
· Be especially careful of look-alike and sound-alike websites.
· Research any company with BBB first and don’t be afraid to report scams by calling 602-264-1721 or visiting www.arizonabbb.org.
For more information about HARP or to find out if you quality, visit www.makinghomeaffordable.gov/programs/lower-rates/Pages/harp.aspx or call the Homeowner’s HOPE Hotline at 1-888-995-HOPE (4673) to speak to a HUD-approved housing counselor for free (assistance is available in English and Spanish, and in other languages by appointment).
If you have credit problems, find a credit-counseling agency in your area by calling 800-388-2227.
To view a list of BBB Accredited Businesses, visit www.SearchBBB.org. Additional mortgage and credit-related tips are also available at www.bbb.org/us/clearpoint-tips.
About BBB Serving Central, Northern & Western Arizona
BBB is an unbiased organization that sets and upholds high standards for fair and honest business behavior. Businesses that earn BBB accreditation contractually agree and adhere to the organization’s high standards of ethical business behavior. Incorporated locally in 1938, today your BBB serves communities in Central, Northern and Western Arizona, supported by over 9,400 BBB Accredited Businesses. BBB provides objective advice, free BBB Business Reviews® and charity BBB Wise Giving ReportsTM, and educational information on topics affecting marketplace trust.