Mortgage Rescue Scams

Authored By: Iowa Legal Aid

Are you a homeowner who is behind in mortgage payments or facing foreclosure?

Help is available but you need to be careful. Many businesses and persons will promise to help you with mortgage problems and save your home. Many times, these promises are not true. They may be scams to get money without providing any help at all.

How do you spot a mortgage rescue scam?

If someone offers to help with your mortgage or foreclosure problems, you may not know for sure if it is a mortgage scam. But there are important warning signs:

  • NEVER send money to someone claiming to represent a government agency to settle your mortgage problems. There are many scams by persons who claim to be HUD, Making Home Affordable and other government agencies. These scammers claim that they have worked out an agreement for your mortgage problems but that you need to send them money (usually thousands of dollars) to start the agreement and keep your home. Although there are government programs to help borrowers with mortgage problems, there are NO government agencies that actually negotiate agreements with your lender and they never take money directly from borrowers for these agreements.
  • NEVER work with anyone who wants money up-front to help with mortgage problems.
  • It’s illegal in Iowa to charge any fee until all mortgage relief services under the agreement are completed. You may be able to get free services in the state of Iowa from certified housing counselors and Iowa Legal Aid lawyers for mortgage and foreclosure problems. Beware of anyone who wants you to sign papers immediately before helping you. NEVER sign over the Deed to your home, for example, in exchange for some promise to get help in the future with your mortgage.
  • BEWARE of someone who tells you to send mortgage payments to anyone other than your lender without your lender’s approval. Some mortgage scammers tell you to send mortgage payments directly to them. Then they keep the money instead.
  • BEWARE of out-of-state lawyers who claim they can help you get a more affordable mortgage with your lender or help save your home from foreclosure. Many out-of-state lawyers contact Iowa homeowners or advertise in Iowa that they can help with mortgage problems. Often these lawyers charge lots of money before agreeing to help you, but they do not do anything.
  • ALWAYS ask a lawyer to review any offer to settle your mortgage problems. A lawyer can review the offer and let you know if it is legitimate or a scam. A lawyer can also explain to you all your rights and duties under any offer before you agree to it.

How do I get free government-approved help with mortgage/foreclosure problems?

There is a free service available to all Iowa homeowners who are facing the possible loss of their homes due to mortgage problems. This service is Iowa Mortgage Help (877.622.4866). Iowa Mortgage Help is a partnership of state agencies, certified HUD housing counselors, and Iowa Legal Aid. By calling Iowa Mortgage Help, struggling homeowners will get FREE housing counseling and help with getting changes to make mortgage payments more affordable. Free legal assistance may be available if the homeowner is facing foreclosure.



Iowa Legal Aid provides help to low-income Iowans. 

To apply for help from Iowa Legal Aid:

  • Call 800-532-1275.
  • Iowans age 60 and over, call 800-992-8161.
  • Apply online at
If Iowa Legal Aid cannot help, look for an attorney on “Find A Lawyer” on the Iowa State Bar Association website   A private attorney there can talk with you for a fee of $25 for 30 minutes of legal advice.
As you read this information, remember this article is not a substitute for legal advice.
Last Review and Update: Sep 14, 2023
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