Tips to Avoid Home Loan Scams

Fairfax County Office of Public Affairs
12000 Government Center Parkway, Suite 551
Fairfax, VA 22035-0065
Contact: Merni Fitzgerald, Director of Public Affairs
703-324-3187, TTY 711, Fax 703-324-2010
Media Pager: 703-324-NEWS (6397)

April 25, 2007

Fairfax County Consumer Affairs Branch Offers Tips to Avoid Home Loan Scams

As the housing market softens and fewer people are buying homes or refinancing their mortgages, exploitative lenders are using mass mailings to pick up unsuspecting customers, especially older adults, limited-English-proficient consumers and those with poor credit.

Homeowners in the Annandale area of Fairfax County recently received letters claiming that they were entitled to cash up to $46,000 under the Community Reinvestment Act, which is a federal government program. What many people discovered once they read the fine print was that the letter was really a solicitation for a home loan.   

Home loan scam letters usually have several defining characteristics:

  • The letter is mailed in an envelope that looks like it was sent from someone or another entity that is familiar to the homeowner, such as a government agency.
  • The letter tells homeowners that they are entitled to cash because they meet the requirements of a federal government program and may provide a link to a government Web site.
  • The letter provides a number to call to claim the cash. It may indicate that the program is available for a limited time and will expire soon.
  • There is usually an asterisk at the bottom of the page that indicates the terms and conditions are on the other side.
  • On the back page, there will be a section with a lengthy list of terms and conditions in fine print. This is where the lender discloses that they are soliciting homeowners for a loan.

By flooding homeowners’ mailboxes with this type of letter, the lender is playing the odds that those who call can be convinced to borrow money based on their home’s equity, even when their income is not enough to keep up with the monthly payments.

The Fairfax County Consumer Affairs branch of the Department of Cable Communications and Consumer Protection suggests that residents who receive a letter that fits this profile contact the Federal Trade Commission (FTC), which has regulatory oversight concerning consumer credit laws. The FTC can be contacted at 1-877-FTC-Help or

To stop prescreened credit solicitations for mortgages, homeowners can opt out or prevent the consumer credit reporting companies from providing personal information to lenders for marketing campaigns. To opt out, call 1-888-567-8688 or visit

The Consumer Affairs branch encourages homeowners to proceed with caution when they receive unsolicited letters in the mail offering cash that appear to be from a government agency. To prevent a lender from taking unfair advantage of a homeowner’s most valuable assets, be alert to the following signs:

  • Unsolicited letters that claim you may be entitled to money because you are a homeowner.
  • Letters that disclose the terms and conditions of their offer in fine print. This information should be disclosed in a conspicuous and prominent paragraph of the letter.
  • Home loan offers received in the mail that were not requested.
  • Solicitations that pressure residents to call a number before a designated expiration date.
  • Letters that use familiar terms or names of companies that have an established reputation, such as government agencies.
  • Letters that use claims, such as “advisory notice,” “this is your opportunity,” “limited time,” or “you may be entitled to cash.”
  • Lenders that offer a loan based on the equity in the home when the homeowner may not have enough income to make the monthly payments.

Residents are encouraged talk to someone they trust before calling a company they have never done business with. For those in the market for a home loan, they should check out different lenders, compare their rates and research their complaint history with the Fairfax County Consumer Affairs branch and the appropriate regulatory agency.

For more information, contact the Consumer Affairs branch at 703-222-8435, TTY 711, or visit


For more news and information, visit

Fairfax County is committed to nondiscrimination on the basis of disability in all county programs, services and activities. To request this information in an alternate format,
call the Office of Public Affairs at 703-324-3187, TTY 711.

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