The recent $75 billion mortgage modification plan captained by President Barack Obama has created a frenzy of scams and fraud now targeting the people the program was originally designed to help. Since October of last year, Freddie Mac and Fannie Mae alone have received a total of $59.8 billion from the recent bailout fund. But is the plan actually helping or hurting American consumers?

According to Moody's, of the 52 million homeowners in the U.S., nearly 13.8 million, or just under 27 percent, owe more money on their mortgage than their property is worth. Credit Suisse estimates the U.S. could see nearly six million new foreclosures between 2009 and 2012 if trends continue at the current pace. Consumers are desperate for a ?life-line,? and are willing to do whatever it takes to stay in their homes.

President Obama's mortgage modification program was designed to rescue up to nine million of those homes from falling into foreclosure; however, the messages received by consumers are not always aligned with this goal.

In a recent warning by the U. S. Treasury Department, federal and state officials are now targeting scams and fraud related to mortgage modification loans and the Obama administration's efforts to revitalize the mortgage lending industry. The Justice Department and the Federal Trade Commission are also stepping in by alerting banks and questioning possible scam artists in connection with illegal loan modification programs.

Government officials report that borrowers in risk of default or foreclosure. are being targeted by scammers who are charging upfront fees of $1,000 to $3,000 to help modify or refinance homes. However most of these loans never happen. Attorney General Eric Holder said the FBI is investigating about 2,100 mortgage fraud cases, a 400 percent increase from five years ago.

Below are a few simple rules to help avoid scams and fraud.

When evaluating a product or service and before signing anything, find out a little information about the company. Check out how long they have been in business. Do they have a clean record with the Better Business Bureau? Do they have any complaints or pending lawsuits? After researching the company, its owners, and a sample of past clients, find out how much money you have to spend to evaluate whether the solution is right for your specific needs.

Make sure that you can afford the initial investment to get started and find out what additional fees will be charged if you decide to move forward. Lastly, make sure that you actually qualify for the product or service if it requires lending or government assistance.

Homeowners can also locate free housing counselors at http://www.makinghomeaffordable.gov or by calling (888) 995-HOPE.