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Step 10 - Federal Trade Commission How to file a complain if you suspect housing fraud.
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This section of the FTC website offers practical information on a variety of consumer topics. The information here can help you avoid rip-offs and exercise your consumer rights.

So read up! Education is the first line of defense against fraud and deception; it can help you make well-informed decisions before you spend your money.

To find FTC consumer publications on a specific topic, click on a category in the menu.

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Federal and State Agencies Crack Down on Mortgage Modification and Foreclosure Rescue Scams (link to file a complaint)

In the wake of an Obama administration program

Lessons from one family's encounter with a forclosure rescue scam

While the government announced yesterday that it is cracking down on mortgage and foreclosure fraud, Consumer Reports tackled to the problem in the March issue and gave some advice on how to protect yourself and your home.

In the video, meet Kari and Roger Mizer, first-time homeowners who faced foreclosure on their home in 2007 after the monthly payment on their adjustable-rate mortgage hit $1,850.

The Mizers found hope when they received a letter from a mortgage-restructuring firm that claimed to have a 95.5 percent success rate in stopping foreclosures, but it turned out to be a scam. (Read more of the Mizer's story here.)

To keep from getting into a similar situation yourself, Consumer Reports advises you to avoid some common traps:

  • Watch out for unsolicited offers
  • Be wary of demands for up front fees
  • Stay away from any service that advises you to stop contact with your lender
  • Stay away from any service that asks you to transfer title of your home

Here's what you should do to deal with the threat of foreclosure:
Anyone anticipating problems making mortgage payments should seek legitimate free or low-cost help as soon as possible. Contact a housing counseling agency certified by the Department of Housing and Urban Development ( or 800-569- 4287). Their agents can assess options and advise you in negotiating with the lender. Advice is also available at the Homeowner's Hope Hotline, at 888-995-4673 (see box below). Another good source of help is the Institute for Foreclosure Legal Assistance,, which funds and trains groups nationwide that give subsidized legal representation to families facing foreclosure. — James Klatell

to rescue troubled homeowners, several federal agencies are teaming up to fight mortgage and foreclosure scams, Treasury Secretary Tim Geithner said Monday.

The administration's $75 billion effort to help as many as 9 million mortgage holders get new or refinanced loans is drawing a lot of interest from homeowners, Treasury Department officials explained.

"Those who would seek to prey on the most vulnerable also seek to intensify their efforts as well," Treasury Secretary Tim Geithner said. "We will aggressively pursue those involved in mortgage rescue scams."

Treasury, the Department of Justice, the Federal Trade Commission and the Department of Housing and Urban Development will lead the effort from Washington. State attorneys general will also participate.

The Treasury's financial crimes investigative unit is sending financial institutions a checklist to help them spot suspicious loan activity and foreclosure rescue scams.

Meanwhile, the Federal Trade Commission reviewed online and print advertising for mortgage foreclosure companies nationwide and found "71 distinct companies running suspicious ads," Treasury said.

The FTC has filed five civil cases against companies offering loan modification or foreclosure services, including one against a company that spent $9 million on TV and radio ads in less than a year.

"These companies are kicking people when they're down, charging enormous upfront fees and sabotaging homeowners who could be getting help for free," said FTC Chairman Jon Leibowitz. "These companies are giving people false hope. They are shameless, as well as opportunistic."

The initiative will bring more resources for the FBI and the Justice Department to investigate and prosecute mortgage fraud, Housing Secretary Shaun Donovan told a congressional panel last week.

The announcement is timely. Mortgage fraud has reached an all-time high even as the number of home loans being issued has shrunk, according to a report issued last month by the Mortgage Asset Research Institute and the Mortgage Bankers Association.

The FBI is investigating more than 2,100 mortgage fraud cases, up almost 400% from five years ago, Attorney General Eric Holder said.

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