More On Loan Modifications Gone Bad

The following links are to stories on financially strapped homeowners reporting problems with loan modification companies they hired to help resolve their mortgage problems:

• Chicago, Illinois: Scams about foreclosures, jobs, IRS feed on desperation. Last September, Esmeralda Carmona only had enough money to pay a fraction of her mortgage. Her husband, laid off nearly a year earlier, had not worked in nine months. Debt was mounting, and the mother of four was prepared to give up. But while driving to her job as a health care clinic coordinator in Chicago, Carmona heard a radio advertisement promising protection from foreclosure. She breathed a sigh of relief. She scraped together $1,500 to pay Centurion Loss Mitigation upfront for its help but found out four months later her house had been foreclosed upon. She says she considers herself a victim, like hundreds of thousands of others, whose tough times have been made worse by too-good-to-be-true quick fixes. The Illinois Attorney General's office filed a complaint against Centurion in early April. A temporary restraining order restricts the company from accepting any upfront fees, and a court date is set for next month. Centurion officials declined to comment for this story.

• Weslaco, Texas: Woman Facing Foreclosure Takes Desperate Measures. She was in trouble. Months behind on her house payments, she says she took desperate measures to try to save her house from foreclosure. In the process, she lost $1,500. The woman asked us to protect her identity because relatives don't know about her financial situation. She showed us copies of checks she sent to Houston-based company called Excel Loss Mitigation: a cashier's check from November 26th, 2008 for $749 and a personal check for $749 sent December 26, 2008. The homeowner says she tried negotiating with her bank, but when that didn't work, she turned to the company. Now, she says Excel Loss Mitigation won't answer her calls.

• Boise, Idaho: State: Mortgage company running business without license. The Idaho Department of Finance has issued a warning to Idaho consumers facing foreclosure: Don't do business with National Foreclosure Relief. IDOF says National Foreclosure has been running its business in Idaho without a license. The state department says the company has never been licensed in Idaho to engage in the offer or sale of mortgage loan modification services as required by state law. The state says it became aware of the company when an Idaho couple complained that it withdrew three payments of $1,200 from their bank account. The money never went toward their mortgage payments, the state says. Instead it went straight to the company. The couple lost their home to foreclosure. See also: Mortgage scam snags couple (A Nevada company took the Mounts' money, and the bank took their home).