It was recently reported that changes to the Obama administration's mortgage assistance program has caused an increase in fraud directed at homeowners attempting to take advantage of the program. The Special Inspector General for the Troubled Asset and Relief Program (TARP) made a statement asserting that the government has not provided enough safeguards to prevent abuse of the program, and also hasn't gone far enough in warning the public about potential fraud.

I don't necessarily disagree that the government can do more to warn homeowners of fraudulent schemes related to the mortgage assistance program. Also, I don't have a problem with the TARP Special Inspector General criticizing the lack of safeguards and warnings to the public. It is his job to point out any areas of the program in need of improvement.

All that being said, there is no amount of information that can be provided, or safeguards put in place, to protect everyone from fraud. When it comes to protecting your home and your finances, the ultimate responsibility falls on you. It should not require government notification to realize that there is an incredible amount of fraud in the mortgage industry, or any industry in which large amounts of money change hands. Mortgages, like any other contract, can be quite complicated; however, that does not excuse an individual from taking whatever steps are necessary to understand what they are signing. If that is more responsibility than you want or can handle, then maybe owning real estate is not for you.


Although many people are in desperate situations due to the mortgage crisis, it is not the desperation that people who organize fraudulent schemes prey on; they prey on those who are not only desperate, but ignorant. The same way a pride of lions singles out a sick, injured, or juvenile animal to attack, criminals target those who demonstrate a lack of knowledge about a particular issue. It is imperative to be well-informed about every aspect of your financial portfolio. If you are seeking to take advantage of the mortgage assistance program, make sure that you know basic information about any company you choose to work with. Some simple rules to follow are below, that can help you decide who to work with.

If a company is:

1. Reluctant to provide various contact information (not just a phone number),
2. Cannot be located online (or is not referenced on more than one website),
3. Refuses to provide documentation of every step of the transaction, or
4. In any way attempts to get money or personal information during your first communication

Then that person or company is likely attempting to defraud you.



The government should provide information about programs that it implements, including any fraud that may be associated with them. But, we are the bottom line entity in charge of protecting ourselves and our assets from fraud. When it comes to being informed and defending ourselves against all kinds of financial crimes, we should act as though the government isn't there, and take total responsibility for educating ourselves about all aspects of our lives, financial and otherwise.

Dependency, on the government or anything else, usually ends with negative results.

More on Protection From Mortgage Fraud:
+ HUD: Don't Be A Victim Of Loan Fraud
+ 6 Ways To Protect Yourself From Different Types Of Mortgage Fraud
+ National Notary Association Issues Consumer Tips To Protect Against Mortgage Fraud