Loan Modification Companies
by Dave Ramsey

Dear Dave,

I’ve noticed that lately there are a lot of loan modification companies opening in my area. I’ve been getting lots of information in the mail, too. What are your thoughts on these companies?

Lonnie

Dear Lonnie,

There are some legitimate people out there who have a good track record and know what they’re doing in the loan modification and short sale processes. My gut feeling, though, is that 70 to 80 percent of them are brand new to the field. They probably bought a business in a box. They think a lot of folks are in trouble, so they’re going to “help” them. The problem is that a lot of these same people couldn’t even spell “loan modification” a week ago!

If I were going to consider getting involved in this process, I’d do a whole lot of investigating into the history of the people. I’d want to know how long they’d been in the business, how many “modifications” they’d done, and how much experience – and real clout – they have with the banking industry and the mortgage and real estate industries.

Here’s a tip: if you hear phrases like “everyone’s doing it these days” or “I started doing this a few months ago,” you need to get away from them as fast as you can!

– Dave