Beware of loan modification scams

In an economic crisis, scam artists will naturally proliferate, and the current mortgage meltdown is no exception. Here are some quick suggestions homeowners can use to steer clear of fraudsters when facing foreclosure.

• Where possible, work with counselors approved by the Department of Housing and Urban Development, says Walter Walker Jr., co-author of "Foreclosure: The American Nightmare -- Strategies for Preventing, Surviving and Overcoming Foreclosure."

• Check the references of anyone you work with and always talk to several professionals before you sign on the dotted line.

• Avoid any service that promises "guaranteed results." That should be huge red flag, says Walker.

• Don't pay upfront fees. According to attorney Charles Hokanson, any mortgage professional should be able to ascertain the specifics of your case during a free, preliminary consultation.

• Ask how much a modification will save before you go too far into the process. Jim Sahnger, marketing director for Loan LifeSavers, a loan modification company in Palm Beach Gardens, Fla., says many people fall victim to modifications that don't work because they knock only a few dollars off the monthly payment.

Facing foreclosure? Know your options.