Friday, May 23, 2008

Lawsuits Filed Against 6 Foreclosure Rescuers

Minnesota Attorney General Lori Swanson filed six new lawsuits in Hennepin County District Court against foreclosure consulting companies that charged Minnesota homeowners up to $2,375 to save their homes but failed to provide promised assistance that would help them retain home ownership.

The lawsuits were filed against: (1) National Foreclosure Relief, Inc., a Nevada corporation with a California business address; (2) Lewis Loss Mitigation, Inc. of Alabama, which also does business as Stop Foreclosure Center and Lewis and Associates Consulting; (3) D.R. Financial Services Corp. of California, which also does business as D.R. Financial and Superior Home Loans; (4) American Foreclosure Specialists, LLC, an Oklahoma limited liability company; (5) Mortgage Default Assistance, LLC, a Florida limited liability company; and (6) Home Assure, LLC, a Florida limited liability company that claims it has offices in the Empire State Building.

The suits allege that these companies used websites, targeted mailings, and/or the telephone to solicit homeowners by assuring that the companies could stop the foreclosure process. Consumers who contacted these companies were charged an immediate fee before any services were performed, in violation of Minnesota law. Homeowners have complained that these companies failed to deliver on promises of assistance after collecting these up-front fees.

The suits allege that these companies violated a 2004 Minnesota law barring “foreclosure consultants” from charging any compensation until after the foreclosure consultant has “fully performed each and every service the foreclosure consultant contracted to perform or represented he or she would perform.” The law also requires entities that charge borrowers fees to assist in stopping, avoiding, or postponing a foreclosure, to have a written contract containing certain safeguards. All six lawsuits seek injunctive relief, restitution, civil penalties, and attorneys fees.

“We do not tolerate mortgage foreclosure consultants taking advantage of struggling homeowners who are already between a rock and a hard place in the worsening mortgage meltdown,” Swanson said.

The Minnesota Attorney General’s Office has published a consumer guide, entitled “Facing Mortgage Foreclosure,” which offers tips for borrowers facing mortgage default or foreclosure, and warns homeowners to be on the lookout for potential scams. Among other things, Swanson provides the following guidance to homeowners facing default:

-Take immediate action to contact the lender if you are having trouble paying a loan. The lender may be willing to work out a repayment plan, loan modification, forbearance, reinstatement, etc. Don’t wait to contact the lender, as delays may jeopardize your options.
-Contact a reputable mortgage counselor. Borrowers may find legitimate counselors by contacting the Minnesota Housing Finance Agency (“MHFA”) or the U.S. Department of Housing and Urban Development ("HUD").
-Don’t agree to pay money in advance to a “foreclosure consultant.” Minnesota law bans foreclosure consultants from collecting a fee until after they deliver their services.

In December of 2007, Attorney General Swanson filed lawsuits against Foreclosure Assistance Solutions, LLC and American Housing Authority, Inc./American Housing Financial, Inc. over similar allegations. Prior to her inauguration, Swanson created a predatory lending study group that proposed legislation to reform predatory lending practices such as loans made without regard to a borrower’s ability to repay the loan and issuing adjustable rate mortgages without verifying that the borrower can pay not just the initial teaser rate, but also the fully amortized rate after the teaser period expires. The recommendations of the study group became law in 2007. Swanson has advocated for similar regulation at the federal level, testifying before the United States House of Representatives Financial Services Committee and the Board of Governors of the Federal Reserve System.

mortgage fraud

1. OK, I’m confused.  How do you come up with $2375 when you can’t pay your mortgage and you live in Minnesota - isn’t that like a few months of payments at least?

   Posted by  on  05/25  at  03:00 PM

2. I Missed A Loan Payment, What Now?

   It is always scary when you miss a loan payment.  It is even scarier when you miss more than one.  You can calm down, though.  You really can come back after missing a few payments.  You just have to get some help and you have to be honest and ask for the help.

   Assistance Please

   Short of coming up with all the money to cover the missed payments, plus the late fees that you are sure to be charged, you need to get some help to recover from missing loan payments.  The best place to go is to your lender.

   Resist the urge to dodge your lender. Call them asap.  You are going to find your lender is typically willing to work with you.  You should be able to work out something that will allow you to get back on track. Your lender doesn’t want to foreclose or repossess or send you off for collections. They want you to make your payments and pay your interest.

   Caution

   Do not agree to something that you can not afford.  If you cannot get caught up in seven days, be honest about it otherwise you’ll just create more stress and harm your finances further. You will end up in the same trouble and the lender may not be so friendly next time around. Do talk to your lender and do be honest and you can get financially back on track.
   “

   Posted by  on  05/26  at  02:43 AM

3. “I Missed A Loan Payment, What Now?

   It is always scary when you miss a loan payment.  It is even scarier when you miss more than one.  You can calm down, though.  You really can come back after missing a few payments.  You just have to get some help and you have to be honest and ask for the help.

   Assistance Please

   Short of coming up with all the money to cover the missed payments, plus the late fees that you are sure to be charged, you need to get some help to recover from missing loan payments.  The best place to go is to your lender.

   Resist the urge to dodge your lender. Call them asap.  You are going to find your lender is typically willing to work with you.  You should be able to work out something that will allow you to get back on track. Your lender doesn’t want to foreclose or repossess or send you off for collections. They want you to make your payments and pay your interest.

   Caution

   Do not agree to something that you can not afford.  If you cannot get caught up in seven days, be honest about it otherwise you’ll just create more stress and harm your finances further. You will end up in the same trouble and the lender may not be so friendly next time around. Do talk to your lender and do be honest and you can get financially back on track.
   “

   Posted by  on  05/26  at  02:44 AM

4. Realestator I can understand your thought on how someone could have that kind of money and not pay the mortgage.
   We payed $2,550 dollars to a realtor to help save our home who I might add did not save me from foreclosure, but I will tell you how we got the money

   Our mortgage was sold to another company in witch we were to make a payment equal to 2 months.  Because of a banking error that check bounced so now we were 2 payments behind.
   The new mortgage company would not accept enough money to make us one payment behind so now we are three payment behind, and they wanted the full amount for three months.
   because we know we have to make a payment we were saving the money to make the payment thats how we had the money.
   So we sought help just like the people in the stories above and lost everything just like the people above.

   Posted by  on  05/27  at  03:45 AM

5. Very interesting and beautiful blog. It is a lot of ful information. Thanks.

   Posted by  on  07/02  at  10:29 PM

6. I have a question about a foreclosure problem. My first and second are with the same bank.  The bank neglected to create an impound account and had to later create one--causing my monthly rate to go up before the first adjustment to the loan. When the adjustment hit, I was already paying what I should have been paying with the first adjustment, so it took me past what I could afford.  The bubble had already burst (this was last November), and I asked the bank how to go about doing a deed-in-lieu (giving the house back to the bank).  They required that I first put it on the market and list it for at least 90 days.  I moved out rather than live in the house and simply stop paying or get behind while continuing to live in a house I could neither sell nor make payments on. I also submitted the paperwork asking the bank about renegotiating the loan--but they didn’t get back to me for about five months.  By the time they finally did contact me, I was already out of the house, it was listed, and I was fulfilling what the bank told me I had to do to be considered for a deed-in-lieu.  When the house wouldn’t sell, the reneged on the deed-in-lieu idea, and simply foreclosed.

   I had literally hundreds of calls from both sides (consumer equity loan--second; and mortgage--first) during that period ... but rarely from anyone I had talked to before, Calls wer often from India and the callers could not give me accurate numbers for Loss Mitigation.  When I did call Loss Mitigation--on both loans--I followed their directions in terms of what to do and how to do it, what to FAX in (they wouldn’t even accept mailed-in forms), and there was clearly a lot of confusion at the bank.  One person told me I could do something, and I followed that advice, while someone else would tell me, no you can’t.

   Once the first foreclosed, I was told that action was going to suffice for both loans (again, from the same bank), which were arranged at the same time by the bank’s own staff.  Today, however, I got a very terse and nasty call from the consumer home equity side, saying that they were coming after me in a separate action from the foreclosure.

   The bank reneged on a number of things they told me to do to salvage the situation.  They also precipitated the problem with their failure to create the impound account that would have left me able to pay for another year (had it been included as it was supposed to have been in the first place).  I have not lived in the house of over 10 months.  I moved out in order to give the bank the opportunity to sell it (etc.), but they did NOTHING with it until I had been out of the house for eight months--basically the same week that they foreclosed, after I had followed their instructions about what to do to arrange a deed-in-lieu.

   I have been lied to and taken advantage of this bank ... whose operative also arranged for an inflated appraisal to make the loan possible in the first place.

   What can I do now?

   Curtis

   Posted by  on  10/23  at  02:36 PM

7. Should a modification office have attorneys in their office, and who is a reputable Modification group in my area, Sacramento, Auburn etc.

   I would appreciate some info.

   Posted by  on  11/26  at  03:50 AM

8. We have our call center in India. We provide Quality Loan Modification Leads @ $50 for qualified+$60 after you close the deal.
   
   
   Our guarantee = > 8% of your lead package converts or we keep giving you leads!
   
   You will have a borrower on the line that is late on their mortgage.
   You will be talking to pre-qualified borrower in distress, late on their mortgage.
   You are the only agent with access to this borrower.
   This is an exclusive lead.
   
   Here is how each lead is generated:
   we dial people at home and play a message. Borrowers who want to know more press one.
   The borrower is quickly transferred to one of our friendly and professional agents who ask
   a few pre-qualifying questions. The info is submitted to you via email and you are immediately
   connected to the borrower via the phone.
   A pre-qualified live lead transfer.

   Posted by  on  12/15  at  02:39 PM

9. In June of 2008 I called Us Foreclosure Relief and spoke to a man by the name of Luis Garcia of Foreclosure Counselor, Luis than had me fax all the paper work that Indy Mac would Need to start the loan modification processes , I was in constant communication with Luis via email and phone . When he was not retuning my phone call and emails, I called Us Foreclosure Relief and found out that he was no long with Us Foreclosure Relief and that my paper work was turned over to a lady by the name of Amira Ihmud at aihmud@usfr.us Since June of 2008 I have been working with Us Foreclosure Relief . They have been telling me not to contact Indy Mac Bank or the negation processes with be jeopardized. I have had to call customer service so many time just to get status because this Amira has done nothing , she tells me know “The rep that I spoke with earlier last week did not check the incestor guidelines. It is not Indymacs decision to not modify your loan it is the INVESTOR who will not do it at this time” ? WHY WAS THIS NOT DISCLOSED to me 5 months ago instead of taking my money. On December 16-2008 the Indy Mac bank I just found out on 12-15-2008 that someone pretending to be me or my husband called Indy Mac back on 12-12-08 and asked Indy Mac bank for a payment plan. We did no such thing. I was told by Stephanie operator # 90S in Austin Texas at 1-800-781-7399 with Indy Mac that some one on 12-12-08 saying they where the bower asked for the payment plan. I or my Husband would not begin to ask for this as we do not know what it is.  Stephanie stated that they will be getting the audio of the conversation as this is a Federal Offence. Can you help me now so my HOME is not lost?  I have called Us Foreclosure Relief to find out why they now will not help me. I get no answer there needs to be a Stiff Penalty when you do this to people we are now on the chopping block if I do not get $5600.00 by December 18th 2008. Can any one help

   Thank You

   mg14982003@yahoo.com

   All these people need to be inedited for racketeering that is what it is in my eyes
   this company is out of Orange, Ca Number is 714-467-0560

   Posted by  on  12/18  at  02:12 PM

10. I don’t know if I am better off for having moved out of the house as soon as I realized that I would not be able to keep up, of if I should have done what so many did ... and continue to live there “rent-free” ... quitting paying the mortgage, and saving the money for the move, etc.

    Instead, I spent about 6 months trying to work with WAMU—on BOTH loans, having to duplicate every action, contact two different offices, fax separately etc. ... as was TOLD by both WAMU offices that I was doing it the right way if I wanted to do a “DEEN IN LIEU” ... meaning to give the house back to the bank without a forclosure.  They told me I had to list it on the MLA (whatever it’s called) for 90 days before they could do the DEED IN LIEU, and I did that.  But soon after it had been on for 90 days (and there was a little interest ... as a “short sale") they (WAMU) informed me that they were going to foreclose anyway. 

    I had been out of the house for six months by that time, and NEVER SLEPT IN THE HOUSE A SINGLE NIGHT that I didn’t pay for.  I moved out attempting their Deed in Lieu on the last day of the last month I paid my mortgage ... which was fully six months after I contacted WAMU to try to straighten out the problem, get the loan adjusted, etc. 

    They didn’t contact me back about modifying the loan for FOUR MONTHS ... by which time I had already been talking with two different WAMU offices about doing the Deed In Lieu, instead. The loan modification people acted like I was in the wrong for not waiting FOR 4 MONTHS for them to contact me back!  When I was working the whole time trying to find the right WAMU people to deal with.

    They were making me do everything by fax and refused to give out numbers to the appropriate offices that I could call and actually TALK to someone and get immediate feedback ... or find out what was going on.

    I understand that they were jammed with thousands of customers’ situations to address.  But 4 months?  And then to shut down all Deed In Lieu efforts after I followed their instructions to the letter?

    I didn’t benefit in any way from the way I handled it ... by moving out at the end of the last moth I paid the mortgage.  WAMU’s people made sure that the RE-FI [that took me from by former lender to WAMU when the bubble was still expanding] happened by making sure that the appraisal came in at a sufficiantly high figure.  That is to say, the appraisal was inflated enough to cover the RE-FI.  If they hadn’t done that, I wouldn’t have been able to RE-FI and I would have remained with my old lender and a lower monthly on a better (less risky, as it turned out) loan.

    Now my credit is completely screwed.  My credit cards chopped my credit limits, and one (Sears, that I had been with for 15 years) cancelled the account, entirely.  Interest rates on the remaining cards went up.  No new credit possible.  All that is crazy since I actually have more money to pay credit cards with now that I don’t have the exorbitant mortgage to pay.

    Anyway. What can you do? I feel like finding a lawyer since WAMU brought on the problem with the jacked-up appraisal (and some other improprieties) and bascically broke our “contract” relative to doing the Deed In Lieu according to THEIR instructions.

    I a way, I regret not living in the house the whole time, and letting them forclose and evict us ... saving the whole amount of the mortgage for 10 or 12 months!  That would have meant leaving to find a rental with about $25,000 in the bank!  Instead, trying to be honest and decent, I left and absorbed the moving cost, the first, last and security deposit on a rental, and left with zero in the bank, causing us to have to struggle to get back in the black.

    Was the lender to blame?  Or was I?  Well, I wanted the Re-Fi, and the lender wanted my loan!  They figured out how to make it happen ... something I could not have done alone.  AND they immediately screwed up my loan by failing to build in the Escrow / Impound account.  THAT mistake precipitated my problem because when they had to construct the Escrow account after the fact, the cost was tacked onto my loan, increasing my monthly mortgage by more than $500 just a few months before the adjustment hit, increasing it ANOTHER $500 ... and killing my ability to keep up.

    Who’s to blame?  The lender surely shares a big proportion of the responsibility.  If they’d done the Deed In Lieu, there would be no foreclosure on my credit report, and my credit would not have been ruined.  I think I have been forced to bear a disproportionate share of the burden.

    Do I have any recourse?

    Curtis

    Posted by  on  12/18  at  04:23 PM