WACO (November 18, 2009)—NeighborWorks Waco had a warning Wednesday about loan modification scams, which the organization says could cost cash-strapped homeowners facing foreclosure not only money, but also their homes.

NeighborWorks is a national nonprofit group that Congress created to provide financial support, assistance and training for community revitalization efforts.

The organization says scammers promise lower payments and lower interest rates to take the burden off those in danger of losing their homes.

“They might not be who they say they are and may in fact be trying to rip you off,” said Celine Thomasson of NeighborWorks Waco.

Feliciana Hill, of Waco learned the hard way.

She lost $1,500 after trying to tweak her home loan through a loan modification agency based in California.

"They said they wanted to help me lower my payments, and lower my interest and everything. I had never heard of modification loans."

The California based company asked her for three postdated checks, which is something NeighborWorks says no legitimate loan agency would do.

NeighborWorks says there are red flags to watch for if you're considering loan modification:

*Avoid anyone that asks for a fee in advance

*No matter what they tell you, a loan modification agency cannot stop a foreclosure

*They cannot guarantee that they will be able to lower your monthly payment

*You should never stop paying your mortgage or stop communicating with your mortgage company