“It’s OK to say no to paying for a loan modification.”

That comment from Lori Gay, president and CEO of the Los Angeles Neighborhood Housing Services (LANHS), underscored the seriousness of a new national campaign that the United States Department of Housing and Urban Development (HUD) has launched in three pilot cities–Los Angeles, Miami and Chicago.

“Know It. Avoid It. Report It.” is an effort by HUD to alert homeowners who are seeking loan modifications to the various types of scams out there that can snare them and then encourage individuals to report any such activities to law enforcement.

About 26 percent of complaints about scams in California come from Los Angeles County, according to Yolanda D. McGill, senior counsel for the Fair Housing and Fair Lending Project with the Lawyers’ Committee for Civil Rights Under Law. This agency also notes that in California nearly $9.5 million has been lost to scammers.

The new campaign tells consumers how to avoid becoming a scam victim; gives red flags and fraud warning signs; provides a complaint form and hot lines to report fraud or suspicious activity; will provide resources to help them find HUD-approved counselors and free housing workshops in every state; and give the names of individuals and companies identified by law-enforcement agencies who have allegedly committed loan modification fraud or foreclosure relief scams.

For more information, call (888) 995-HOPE or visit the website www.hud.gov/preventloanscams.