Wednesday, October 21, 2009
New Law Prohibits Up-front Fees for Foreclosure Relief Services
California Attorney General Edmund G. Brown Jr. issued a consumer alert warning California homeowners to avoid individuals and businesses that charge up up-front fees for foreclosure relief services in light of a just-enacted state law that makes this "abusive practice" subject to prosecution.
"Over the past two years, unscrupulous attorneys and real estate brokers have abused their trusted roles and exploited desperate homeowners seeking to avoid foreclosure," Brown said. "The loophole that allowed this abusive practice to continue has now been closed, and homeowners should avoid any person charging up-front fees for foreclosure relief services."
Earlier this week, Governor Schwarzenegger signed into law Senate Bill 94, which immediately makes it unlawful for any licensed attorney or real estate agent "who negotiates, attempts to negotiate, arranges, attempts to arrange, or otherwise offers to perform a mortgage loan modification or other form of mortgage loan forbearance for a fee or other compensation paid by the borrower...to claim, demand, charge, collect, or receive any compensation until after the [attorney or agent] has fully performed each and every service the licensee contracted to perform or represented that he, she, or it would perform."
Until now, licensed attorneys and real estate brokers could charge advance fees under certain limited circumstances. Foreclosure scam artists often sought to exploit this exception. The new law closes this loophole.
Brown has made it a top priority to protect homeowners and combat loan modification fraud in California. In August, threatening possible criminal and civil prosecution, he ordered 386 mortgage foreclosure consultants to register with his office and post $100,000 bond. Brown also ordered more than two dozen foreclosure assistance companies to substantiate suspect claims made on the internet and in direct mail advertising.
This action followed a nationwide sweep in July that led to lawsuits against 21 individuals and 14 companies who ripped off thousands of homeowners seeking mortgage relief. In total, Brown has sought court orders to shut down more than 30 companies and has brought criminal charges and obtained lengthy prison sentences for dozens of deceptive loan modification consultants.
Loan modification consultants continue to exploit homeowners desperate for relief. This year, Brown's office has received more than 2,500 complaints against loan modification consultants and their businesses. This is a dramatic jump from 2008, when less than 200 complaints were filed.
As part of today's consumer alert, Brown offered the following tips to homeowners:
Don't pay up-front fees. Foreclosure consultants are prohibited by law from collecting money before services are performed.
Don't ignore letters from your lender or loan servicer. Responding to those letters is your best bet for saving your house.
Don't transfer title or sell your house to a "foreclosure rescuer." Beware! This is a scam to convince homeowners they can stay in the home as renters and buy their home back later. It might also be part of a fraudulent bankruptcy filing. Either way, a scammer can then evict the victim and take the home.
Don't pay your mortgage payments to anyone other than your lender or loan servicer. Mortgage consultants often keep the money for themselves.
Never sign any documents without reading them first. Many homeowners think that they are signing documents for a loan modification or for a new loan to pay off the mortgage they are behind on. Later, they discover that they actually transferred ownership of their home to someone who is now trying to evict them.
If someone demands an upfront fee for foreclosure assistance services, you can report them to the Attorney General's office at 1-800-952-5225, or file a complaint online at: http://www.ag.ca.gov/consumers/general.php
For more information on the Brown's action against loan modification fraud visit: http://ag.ca.gov/loanmod.
The text of Senate Bill 94 can be found at: http://www.leginfo.ca.gov/pub/09-10/bill/sen/sb_0051-0100/sb_94_bill_20091011_chaptered.html
mortgage fraud
Would like to file suit against WMU/Chase for misrepresentation, though cannot pay up front attorney fees.
Posted by on 11/04 at 07:02 PM
Post a Comment
The trackback URL for this entry is:
Trackbacks:
|
Some Sources require Registration.
Mortgage Scam Ends with Prison
The Morning Call
A judge didn't hold back when Shirley Matthews appeared before him Tuesday to be sentenced for stealing from a Monroe County man instead of helping him save his home from foreclosure, as she was hired to do.
Woman Gets Prison Time After Mortgage Scam Conviction
Pocono Record
A New Jersey woman will be spending two to five years in state prison after she was sentenced on Tuesday for promising to help homeowners avoid foreclosure and then keeping the money she was given for their mortgages.
2 Indicted in Mortgage Scam Face New Charges
Newsday.Com
Prosecutors add extra charges to two who are charged in LI mortgage fraud with county legislator, dominatrix and her husband
Untangling Mortgage Fraud in Chicago Condo Buildings
Chicago Public Radio
Why did so many units go into foreclosure all at once? In some cases, the reason can be traced to mortgage fraud.
No Contest Plea Entered in Real Estate Fraud Case
Northbay Business Journal
Juan Carlos Alcala of Windsor pleaded no contest to nineteen felony counts and admitted three special allegations for defrauding real estate investors, money laundering and elder fraud.
Bedford Woman Sentenced to a Year in Prison for Mortgage Fraud
Plain Dealer
Sharon Cox, 49, of Bedford, was sentenced today to a year in prison for mortgage fraud involving money laundering, theft and receiving stolen property from August 2008 through March.
CITIZEN JOURNALISM: Mortgage Fraud High in Area
Washington Times
According to the FBI, Virginia, Maryland and the District are among the top 10 jurisdictions experiencing mortgage fraud.
Former Vegas Resident Charged with Mortgage Fraud in Nevada
National Mortgage Professional Magazine
A former Las Vegas resident has been charged with federal conspiracy and fraud charges for his involvement in a Nevada mortgage fraud scheme involving straw buyers and falsified mortgage loan documents...
Missouri Man Sentenced for Mortgage Fraud
Belleville News Democrat
A suburban St. Louis mortgage company operator has been sentenced to more than 11 years in prison for a mortgage fraud scheme.
12-Year Prison Term in Mortgage Swindle
Washington Post
A Maryland woman who stole millions from Washington area homeowners trying to avoid foreclosure is a "vulture" whose case should serve as a warning to other con artists...
Previous Articles
|
Trial coverage provided by Anne Mitchell, Crazy Fish Realty.
F. Jeffrey Miller Update - October 20, 2009
A hearing was held in Topeka, Kansas in front of Judge Julie Robinson. Miller is currently being held pending his sentencing which is set for December 22nd, 2009 at 9:00 a.m.. Steve Vanatta and Hallie Irvin, Miller's codefendants, will be sentenced at that time also.
Several motions were heard this week. One was a motion for Miller to be released pending his sentencing. Miller's attorney, Jeff Morris, argued that the court had dismmissed with predjudice the matter involving Miller's purchase of a commercial lawnmower, violating the court ordered monitoring agreement. He also argued that Miller was not a flight risk and should be released. This motion was denied.
Another motion heard by Judge Robinson was that of an escrow account containing proceeds from the sale of Miller's forfeited assets. This account has a balance of $143,000. Attorney Morris argued that his firm was due $100,000 for work done in the Miller matter, to date. The government argued that his 'un-itemized fees' were 'exhorbitant'. The balance of the funds, Morris argued, should be released to the Miller family to help pay for mounting household expenses.
The government argued that the 'Asset Forfeiture Provision' applies down to 'the last penny' and that 'the rights of the victims to made whole are of paramount immportance' and that no routine household expenses like Visa bills, are allowed.
Attorney Morris argues that there is more than enough assets to satisfy the jury's judgement of $2.65 million dollars. The government argues that the estimated value of his assets are only $1.4 million.
The government also stated that Miller has been paid dividends from a company Miller has an ownership interest in; Boreflex. From July, 2008 to present, Miller has been paid $330,509.30 from Boreflex, unbeknownst to the court appointed monitor.
Present in the courtroom was Todd Earnshaw. Earnshaw was indicted along with Miller and others in what is commonly referred to as 'Miller I'. That trial is scheduled to begin on January 11, 2010 in Topeka, Kansas.
More Trial Coverage
|
|
|
|
|
|
|
|
|
|
|
Rachel Dollar, the editor of Mortgage Fraud Blog, is an attorney and Certified Mortgage Banker who handles litigation for lending institutions and secondary market investors. She is an author and a nationally recognized speaker on the topic of mortgage fraud. Ms. Dollar is a shareholder with the law firm of 
