An 'Ewa Beach woman recently received an official-looking letter in the mail suggesting that she convert her current mortgage loan to a new loan.

The letter alarmed her because it included her mortgage company's name and was marked: "Important Time Sensitive Material." At first glance, she thought she was being required to change, which distressed her, especially in light of all the mortgage crisis news.

The letter said: "Due to the recent high rate of defaults in mortgage payments, many lenders are no longer able to issue new loans to homeowners. As a result, the U.S. Government is expanding its guaranteed loan programs to qualified borrowers at interest rates that are considerably below that of conventional mortgages."

It continued: "You have been pre-selected to receive a Government Guaranteed Loan." It offered a 6 percent 30-year-fixed rate loan.

Stephen Levins, executive director of the Office of Consumer Protection, said some companies send out this kind of solicitation letter hoping to bring in business.

He said it's fairly easy for a company to check public records to find out which lender holds the mortgage on a property, such as by checking the state Bureau of Conveyances.

"There is quite a bit of this stuff going around from the Mainland," Levins said. He said companies draft the letters to get you to pay attention.

If you think the letter came from your mortgage bank or another company that you do business with, you're less likely to just shred the letter.

"You may have companies that do everything they can to convince you that you're dealing with the same company," he said, which can be described anywhere from misleading to deceptive.

Levins said this letter offers a good reminder to carefully read any such letters you receive in the mail. To check who sent it and not respond without understanding what you have.

"First of all, you've got to read all the fine print," Levins said. "You should contact your own financial institution" if you have questions about what is being offered or required.

In this case, the reader realized that her own lender was not proposing a change after reading the letter more carefully and talking with friends and family.

But she felt that the letter was misleading and possibly fraudulent. "I thought they were trying to make me refinance," she said. "That's dishonest."

Levins said most letters like this are simply companies pitching strangers to try to get more business. He suggested such letters be treated like any solicitation.

"If you are inclined to try to refinance, you need to shop around at reputable financial institutions and compare," he said.

Generally, such letters are mass mailings that are sent from the Mainland, he said.

Although these may look far more official than the e-mails from the Nigerian official/royalty/wealthy business executive looking to transfer millions of dollars to you, Levins said, they actually are similar in that they try to pull in the unsuspecting.

"It goes back to the old adage: 'If it sounds too good to be true, it probably is,' " Levins said.

He said a good tip is if the company is offering a very low interest rate without even examining your actual financial records. "It's ridiculous and unbelievable and people should treat it as such," he said.

Levins said people need to do their own homework, even if they believe they are being approached about a government program.

"There are thousands of government programs," he said.

Levins urges additional caution toward any company that appears to be trying to persuade customers that they are affiliated with a company that they are not.

"That's a problem," he said. "No reputable company should be sending solicitations to homeowners to try to imply that they're something that they're not. That's just wrong."

Another letter to watch out for comes as an unsolicited "offering" to customers to renew their car warranties, even for customers who never had them. Same advice, don't assume and read everything carefully before spending any money.

Are You Buying This? is a weekly consumer column. Curious about consumer issues or have a tip to share? Reach Robbie Dingeman at 535-2429 or rdingeman@honoluluadvertiser.com.

Reach Robbie Dingeman at rdingeman@honoluluadvertiser.com or 535-2429.