Offers by companies to modify mortgages and create financial relief are often part of fraudulent schemes. Financially troubled borrowers should be leery of falling prey to foreclosure relief scams. A recent announcement by the California Association of Realtors is attempting to increase consumer awareness of these scams at a time when such fraudulent setups are becoming more prevalent.

San Diego foreclosure prevention lawyers note that scammers find consumers to victimize through the public foreclosure notices publishing in newspapers, on the internet and elsewhere. Scammers purport to be able to stop foreclosure proceedings immediately, and many offer money-back guarantees to create the illusion of a no-risk situation.

But these are a serious financial hazard to homeowners and could create far more problems than they promise to solve. Consumers need to understand the rules and regulations governing loans and loan modification in order to protect themselves from this scam and others that use similar tactics.

Only your original mortgage servicer has the authority to make modifications to a loan -- third-party setups claiming to provide these modifications are unable to make any changes. Additionally, charging up-front fees for mortgage modification is illegal in almost all cases -- legitimate companies will never demand this type of payment.

Consumers should also be reluctant to do business with companies or entities that offer loan modification on a mortgage but do not encourage you to communicate with your mortgage servicer regarding the matter.

Source: Mercury News "Realtors warn homeowners to beware of mortgage modification scams" Jan. 2, 2012