(LoanSafe.org) – If you decide to work alone, avoiding foreclosure can definitely be a challenge if you do not have many hours of time on your hands during “bank” hours. Trying to negotiate a loan modification or short sale can take many hours of follow up calls every week and often have to send in the same documents over and over again..

Working with a housing counselor can make the job easier for people who work full time and don’t have time on their hands to play phone tag with their assigned representative. There are many non-profit housing counselors out there such as HOPE NOW and NACA, as well as some legitimate “for-profit” services such as the Loan Mod Help Center.

BUT ALWAYS BE CAREFUL: There are tons of foreclosure prevention and mortgage modification scams out there and it can be hard to decipher the legit companies from the scammers. Anyone who charges an upfront fee (often ranging from $2-4K) for foreclosure prevention services is a clear sign of a scam! Most states prohibit companies from charging upfront fees for these services.

Instead of falling for some kind of foreclosure fraud scheme, you can always guarantee you are getting legitimate service through a HUD-approved housing counselor. The first thing you should know is that there is no charge to work with a HUD approved counselor.

Don’t be confused with housing counselors and housing agencies. Housing agencies are allowed to charge reasonable and customary fees for other forms of housing counseling and education services. Be wary of the “reasonable fees” though and never drop your guard! Scammers out there will often pose as legitimate agencies or even the government and may use this title to charge illegal upfront fees.

The total amount of fees must be presented to the borrower in advance to performing the services. In addition, HUD has addressed that for the services, there might be such a thing as paying to much for a specific service. Agencies who promise you a loan modification could get away with charging you thousands of dollars if you didn’t know any better. Finally, no agency can charge fees to individuals who demonstrate they cannot afford the fees.

What do HUD approved counselors do?

A HUD approved counselor will review your situation and help determine the best option available to help avoid foreclosure. What they don’t do is try and take over the situation. Be sure to notice a red flag if a counselor says that they will work with your lender for you alone, or if they try and convince you to sign your title over to them. The best kinds of housing counselors communicate with you to find what options are the best for you.

Housing counselors may certainly contact your mortgage company on your behalf, but make sure you are kept up to date on everything that’s going on. Another one of their overall goals should be to help you to find a budget where you can manage your mortgage payments each month. Counselors will also provide you with local resources that may be helpful to you.

So where can I find a counselor?

The answer is from the U.S. Department of Housing and Urban Development (HUD). HUD sponsors many housing counseling agencies all over the nation to provide aid to homeowners, homebuyers, renters, delinquent homeowners, those who seek credit assistance, and seniors who want reverse mortgages.

To find a HUD approved counselor, you may call 888-995-HOPE (4673) or visit this link. In addition, the advisers are available in 160 languages. HUD office across the country can also be located here.

Avoid scams!

As stated above, housing counselors cannot charge you any fees for their services, however housing agencies can. Despite this, they are limited on what they can charge.

To avoid fake representation, it’s important to know what is real and what is not.

1. If a representative offers you a lease back or buy back option, it’s almost always a scam. Never transfer your title over to anyone except your lender or servicer.

2. Be sure to know which assistance programs are real and which ones are not. If the program isn’t on HUD’s website (or another .gov website) the program is probably a fraud. No fees are associated with federally backed programs, so if a program charges an upfront fee, research it immediately.

3. Never give money to someone to make payments for you. If you don’t know them, they’re probably not going to be making any payments with cash handed over. They’ll probably keep it.

4. Any claims from companies that they can eliminate your debt are also fakes. Debt can only be reduced, and that is by programs backed by the government or by your servicer itself.