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How the Provident Law Group Loan Modification Program in California is Alleged to Try to Sidestep the Upfront Fee Ban

California has been tough on loan modification companies and in fact passed laws to prevent upfront fees. One of the companies that recently came under attack was a company I wrote about, Liberty Law Firm.

After my piece KTLA did their own investigative report on Liberty.

According to an confidential source, that contacted me at [email protected], the reporting lead to Liberty folding up shop for the most part, leaving a chain of ex-Liberty Law Firm affiliates floating about. I was told there are some that continue to do business in Ontario, California under the old business model and there is the Liberty Law Group nearby that was never involved in the loan modification issue to begin with. Poor guys.

I am told that Liberty Law was an outgrowth of a company called Noah Savings, located at 17 Goodyear, Suite 125, Irvine, California and owned by Tuan (Tom, Thomas) Duong.

According to the State of California, Noah Savings Mortgage, Inc was related to a Thomas Dinh Duong. – Source. Duong also owned a company called TD Capital Lending as well. – Source

I was told Duong is not an attorney and has a background in brokering sub-prime mortgages. It is alleged that Duong hooked up with attorney Brian J. Colombana to be the front man, in the Liberty Law operation to make it seem like it was a real law firm. My source assures me that it was not.

Apparently the Liberty Law loan modification services ran off the tracks not only because of the investigative reporting but also because of affiliates running amuck and making unrealistic promises to consumers.

In 2009 California passed SB 94 that was supposed to prevent loan modification companies from charging any upfront fees.

On October 11, 2009, Governor Schwarzenegger signed Senate Bill 94 (Calderon), and the legislation took effect immediately upon his signature. Thus, California law now prohibits any person, including real estate licensees and attorneys, from demanding or collecting an advance fee from a consumer for loan modification or mortgage loan forbearance services affecting 1 – 4 unit residential dwellings. California SB 94.

I am told that after the quick discarding of Liberty Law, Tom Duong moved rapidly to open a new company called Provident Law Group and found a new attorney to front that organization, Jeffrey Cancilla – Source.

How the Provident Law Group Loan Modification Program in California is Alleged to Try to Sidestep the Upfront Fee Ban

Provident Law Group advertises they are located at 17 Goodyear, Suite 125, Irvine, California. – Source. You will noticed that is the exact same suite and address that Liberty Law and Noah Savings were located at.

The ProvidentLaw.com domain name was registered on March 29, 2010 and Provident Law Group was registered on April 1, 2010 and the agent of service is Jeffrey Cancilla, 1748 W. Katella Avenue, Suite 112, Orange, CA 92867. – Source

I am told that Provident Law Group is thinking of relaunching the Liberty Law product of $995 telephone loan modifications. It is alleged that the Liberty Law target market for this service were hispanic and blue-collar consumers that were less likely to understand what they were being sold.

The telephone loan modifications that might be adopted by Provident Law were advertised under Liberty Law as a loan modification that is obtained after the consumer goes into the office, goes through some qualification process and then, while in the office, a call to the lender is made and if a positive response is received the consumer pays $995. But apparently what the consumer does not understand is that any approval by the lender is not a modification but merely an acknowledgment that the consumer would be eligible to submit a modification application to the lender.

I was told by an current Liberty Law franchise employee that “the actual percentage is less than 20% for all homeowners getting permanent modifications.”

The response of the insider seems to support the allegation that the telephone loan modification service is not in fact a real loan modification. The inside employee said “We assist in getting consumers QUALIFIED for a modification and assist consumers in putting financial information and hardship information together and submit for consumer to Bank.”

The emphasis on qualified was as the employee said it and appears to understand the consumer is not getting a loan modification but only qualified to submit a request for a trial or permanent loan modification.

ProPublica recently reported that the trial modifications were not meaningful.

““Being in a trial modification if you don’t get a permanent modification is worse than having not been in a trial modification. Period,” said Diane Thompson, an attorney with the National Consumer Law Center.

Last year, a million Americans were given trial mortgage payment modifications by banks and other companies that service mortgages. The Treasury Department has in turn provided financial incentives to the banks. But the Treasury Department encouraged banks to start trials quickly, causing banks to make trial offers to people without fully vetting their eligibility, and ultimately letting in many homeowners who were destined to fail. After lingering for months awaiting final approval, thousands of homeowners are now being dropped from the program as banks eventually decide they don’t qualify.

Lauten made the reduced payments for seven months, but was told in March that she’d been denied a permanent modification, after the bank seems to have decided her income wasn’t sufficient. The difference between the regular payments and reduced payments accrued during the trial period, meaning Lauten now owes $2,200 on top of her payments, which have returned to more than $900 a month. According to a letter Wells Fargo sent Lauten, the bank gave her one month to pay back the $2,200, or else the bank would begin the foreclosure process.” – Source

And without some confidence that loan modifications are going to work out, any trick or tactic to collect money from a consumer as income before that permanent loan modification is granted, if at all, in my opinion, seems to violate the spirit of loan modification fee restrictions and certainly SB 94 in California.

Here is How the Advance Fee Loan Modification is Alleged to Circumnavigate the California Advance Fee Ban

I am told by an inside source that the way around the ban on advance fees uses an escrow company to accept the funds from the consumer instead of the company taking the funds directly.

But rather than the permanent loan modification being approved, the company still takes funds quickly from the escrow account and I am told that while this skirts SB 94 some feel it looks defensible in court and feel confident this does not violate the law.

Here is how this approach is said to unfold. The consumer is sold a loan modification program that costs as much as $3,500. The consumer may pay this fee in a few installments but is encouraged to pay as much as possible in the first payment.

Rather than the escrow account sitting there for the permanent loan modification to be accomplished, the escrow account is charged for hurdles or milestones that occur quickly, typically within two weeks. For example, opening the file is a 20% charge against the original escrow account balance, calling the lender takes 20% of the escrow account, sending in the application is 20%, and it is alleged that eventually 90% of that escrow amount is gone within weeks while a permanent loan modification, if ever obtained might take six months to a year or more.

I was told that only 25% or less of consumers paying for a loan modification will actually receive a permanent loan modifcation. And when the loan modification is not obtained the consumer is eligible for the remaining 10% left in the escrow account.

Good Guys Wandering Into a Troublesome Area

While both Tom Duong and Jeffrey Cancilla, Esq. might have good intentions, in my opinion the new Provident Law Group seems to be ramping up as a marketing entity for loan modification services to circumnavigate the upfront fee ban. While the loan modification services might be approached with professionalism, the bottom line is that the vast majority of people are having their escrow accounts drained despite no reasonable expectation that a meaningful permanent loan modification will be obtained.

If consumers are gladly paying $3,500 for a 1 in 5 chance, or less, of getting a permanent loan modification and are aware of those long odds, that’s one thing. But if consumers believe the investment in the loan modification services has a very likely chance of being accepted and the company knows it won’t be, then that’s an entirely different matter.

I emailed both Tom Duong and Jeffrey Cancilla for comments on information contained in this report. After waiting three days for a response, they have not responded by the time this article was published.

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How the Provident Law Group Loan Modification Program in California is Alleged to Try to Sidestep the Upfront Fee Ban
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Update: June 11, 2010

I just discovered this employment advertisement that was placed by Provident.

Date: 2010-05-19, 9:54AM PDT
Reply to: [email protected] [Errors when replying to ads?]

About us: We are a leading Nationwide Loan Modification Company that has been serving various markets throughout the country. We pride ourselves on closing sales, retaining clients, rewarding our staff and providing a strong and opportunistic platform for our associates to succeed.

What we are looking for: A success driven individual who has the skills to back it up. This position requires making several calls and for those who are go getters and hungry to make large commissions, we have the tools to allow you to see $100,000+ while working full-time. In addition, we also require these basic skills and characteristics: One year loan modification or mortgage sales experience; Full-time availability, basic computer skills, high moral ethics and the ability to work in a structured environment.

What we offer: We offer the best exclusive marketing leads, the largest commission splits, [Wouldn't this be legal fee splitting?] and a professional working environment which is unique within the industry. While you work diligently to assist our clients on a daily basis, we offer you training and support from team members who have closed hundreds of sales, a management team who genuinely cares about your career path, a competitive salary, days off, a flexible schedule to meet you challenges and a business casual dress code.

Why you should apply? Are you tired of hearing about the recession and how difficult it is to earn in this market? Are other companies luring you with flashy ads and a promise of things they cannot deliver? Are you sick and tired of letting your valuable skills go to waste, while waiting for the economy to turn? Stop waiting and seize the moment. This position has a tremendous amount of potential to grow both in terms of salary and scope.

Look at the straight facts.

Last month, we SAVED hundreds of homeowners across the nation from losing their residence and credit. You probably know at least five people who are in danger of foreclosure. Isn’t it better to do something about the problem, rather than waiting for someone else to clean up the housing mess? Make a difference today in this thriving industry.

Take the first step to financial freedom and call to set up a private interview.

Don’t wait any longer; call today to start working in a booming field!

Hiring Organization: PROVIDENT LAW GROUP – (949) 415-7368
Location: Irvine, CA
Compensation: 75K
Principals only. Recruiters, please don’t contact this job poster.
Phone calls about this job are ok.
Please do not contact job poster about other services, products or commercial interests.
PostingID: 1748890486 – Source

I also found this person identifies himself as the Director of Legal Affairs of Provident Law Group.

How the Provident Law Group Loan Modification Program in California is Alleged to Try to Sidestep the Upfront Fee Ban by

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  • Brian

    Go to http://soundcloud.com/jeffrey-http://www.complaintsboard.com… or http://www.ripoffreport.com/at… for real information about Jeffrey Cancilla.

  • Mortgage King

    Get a Life Sandy

  • Steve Rhode

    Complaint to the California Real Estate Commission and follow this process.

  • Sandy

    Hi Steve,
    My experience with Jeff Cancilla was thru a processing company called “California Legal Assistants” and “Mendez Loss Mitigation”. I fired them for consistenly providing conflicting information, lack of professionalism, and poor follow thru. I demanded a refund of money they were holding to be put toward a reduced payoff of my second mortgage but instead got the runaround from all parties involved. Mr. Cancilla never once answered my calls, emails or certified letter. I have a complaint filed with the California Bar Association…any other enforcement agencies you recommend I should pursue filing a complaint with?

  • Sandy

    Hi Steve,
    My experience with Jeff Cancilla was thru a processing company called “California Legal Assistants” and “Mendez Loss Mitigation”. I fired them for consistenly providing conflicting information, lack of professionalism, and poor follow thru. I demanded a refund of money they were holding to be put toward a reduced payoff of my second mortgage but instead got the runaround from all parties involved. Mr. Cancilla never once answered my calls, emails or certified letter. I have a complaint filed with the California Bar Association…any other enforcement agencies you recommend I should pursue filing a complaint with?

    • http://GetOutOfDebt.org Steve Rhode

      Complaint to the California Real Estate Commission and follow this process.

  • Sandy

    Love it! Call them on their lameness :) Ha ha ha

  • sophia

    i am not the owner of provident law, so i cannot answer your question regarding the licensing status.
    also, the sb94 states that a law firm can charge fees for this service prior to completion of work, if i am reading it right. it is only attorneys who can do this. please see section 10085.6(a)(5)
    i can appreciate that you are trying to protect the consumer, but if you can give some of us a better look, you can see taht there are some of us that really wants to do the work.

    • http://GetOutOfDebt.org Steve Rhode

      Regardless, here is the ethics opinion issued by the California State Bar specifically on SB94 and fees.

      On October 11, 2009, SB 94 (Calderon) was chaptered. The legislation took effect immediately. The full text of the legislation can be found on the Official California Legislative Information Web site.

      Prohibition against Collection of Advance Fees

      The legislation prohibits the collection of advance fees for loan modifications, as specified. Among other provisions, new Civil Code Section 2944.7(a)(1) provides as follows:

      “Notwithstanding any other provision of law, it shall be unlawful for any person 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 do any of the following: (1) Claim, demand, charge, collect, or receive any compensation until after the person has fully performed each and every service the person contracted to perform or represented that he or she would perform.”

      Civil Code Section 2944.7(d) provides that Section 2944.7 applies only to mortgages and deeds of trust secured by residential real property containing four or fewer dwelling units.

      Under new Business and Professions Code Section 6106.3(a), it constitutes cause for the imposition of discipline of an attorney for an attorney to engage in any conduct in violation of Civil Code Section 2944.7.

      The State Bar’s interpretation of the new statutory language, in response to the three most common questions it has received, is set forth below. The State Bar’s Office of the Chief Trial Counsel will enforce the statutory language consistent with this interpretation.

      1. Is Civil Code Section 2944.7(a)(1) retroactive?

      Agreements entered into and advance fees collected prior to October 11, 2009 are not affected. Advance fees based on agreements entered into prior to October 11, 2009, but collected after October 11, 2009, must be fully refunded.

      2. Is it a violation of Civil Code Section 2944.7(a)(1) to collect an advance fee, place that fee into a client trust account, and not draw against that fee until the services have been fully performed?

      Yes. The statutory language of the prohibition uses the word “receive” and the plain meaning of that term is broad enough to encompass a lawyer’s receipt of advance fees into a trust account. Civil Code Section 2944.7(a)(1) makes it unlawful to “collect, or receive any compensation until after the person has fully performed each and every service the person contracted to perform or represented that he or she would perform,” whether the compensation is placed into the lawyer’s client trust account, general account or any other type of account.

      3. Is it a violation of Civil Code Section 2944.7(a)(1) to ask for or collect a “retainer”?

      Civil Code Section 2944.7(a)(1) makes it unlawful to “[c]laim, demand, charge, collect, or receive any compensation until after the person has fully performed each and every service the person contracted to perform or represented that he or she would perform,” even if that compensation is called a “retainer.”

      Required Notice to Borrower

      The legislation also requires that specified notice be provided to the borrower, as a separate statement, prior to entering into any fee agreement with the borrower. Among other provisions, new Civil Code Section 2944.6(a) provides as follows:

      “Notwithstanding any other provision of law, any person 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, shall provide the following to the borrower, as a separate statement, in not less than 14-point bold type, prior to entering into any fee agreement with the borrower:

      It is not necessary to pay a third party to arrange for a loan modification or other form of forbearance from your mortgage lender or servicer. You may call your lender directly to ask for a change in your loan terms. Nonprofit housing counseling agencies also offer these and other forms of borrower assistance free of charge. A list of nonprofit housing counseling agencies approved by the United States Department of Housing and Urban Development (HUD) is available from your local HUD office or by visiting http://www.hud.gov.”

      Civil Code Section 2944.6(b) provides that if loan modification or other mortgage loan forbearance services are offered or negotiated in one of the languages set forth in Civil Code Section 1632, a translated copy of the required statement must be provided to the borrower in that foreign language.
      Civil Code Section 2944.6(e) provides that Section 2944.6 applies only to mortgages and deeds of trust secured by residential real property containing four or fewer dwelling units.

      Under new Business and Professions Code Section 6106.3(a), it constitutes cause for the imposition of discipline of an attorney for an attorney to engage in any conduct in violation of Civil Code Section 2944.6. – Source

      Here is an assessment of SB 94 by a lawyer.

      Bottom line information you need to know:

      If you are providing loan modification services, you will no longer be able to charge fees in advance until January 1, 2013 (unless extended)

      Fees nor the services to be performed may not be divided into “milestones” or “stages” by getting around this advance fee prohibition, i.e. you must complete “each and every service” (specifically prohibited if services are broken up just to usurp this bill)

      You may not secure a lien of any type to assure payment of compensation

      Most of the bill only applies to residential mortgages

      All agreements to provide loan modification services must include specific language disclosures

      Violating parts of this bill is much more strict including heavy fines and possible jail time. There are also disciplinary changes for violating this law for both licensed real estate brokers and licensed attorneys.

      Attorneys are also effected by this law, but treated differently in some circumstances

      There are not any easy “workarounds” in being able to collect a fee in relating to any kind of loan modification service no matter how you define the service.

      After January 1, 2013, there will still be some permanent changes still in effect including the definition of an “advance fee” and how the DRE commissioner treats advance fee use. – Source

      Another attorney offers this up in warning:

      Well the last year has been pretty crazy in the loan modification business. We have seen lots of companies being shut down by the California Department of Real Estate and California State bar (ex. brokers, attorneys, “attorney-backed” and “attorney-based” law centers and fictional “law groups” etc.) who were found out as being nothing more than scams, shams, and ripoff artists.

      Some of the reasons these companies were the subject of cease and desist (or desist and refrain) letters is the following:

      They held themselves out as loan modification specialists and loan modification experts when in fact they had no special skill, training, experience, or track record.

      They took advance fees without the proper advance fee agreement that received a letter of non-objection from the DRE.

      They collected advance fees but failed to properly place funds in a Client trust account.

      They failed to properly provide verified accountings as required by the California Department of Real Estate.

      They failed to have all of the loan modification advertising approved by the DRE.

      They took files that were in notice of default (this applies to the non-attorneys) in violation of the Foreclosure Consultant Law.

      The committed other acts of outright fraud, misrepresentation, deceit and false advertising.

      In the case of Loan Modification Attorneys they may have illegally partnered with non-attorneys (such as brokers and foreclosure consultants) that would not only tout the attorneys services – taking the form of an illegal runner or capper – but also illegally splitting what could be construed as a legal fee, and engaging in other shady conduct that violates an attorneys code of ethics.

      In addition, Post SB94, some entities accepted an advance fee in violation of SB94 which prohibits both attorneys, brokers, and foreclosure consultants from accepting any type of advance fee for loan modification or foreclosure forbearance work.

      They failed to provide refunds when their contracts stated they would, or where verbal representations of 100% money back guarantee were given.

      Yes, there were a whole lot of callous and cavalier people/companies raking homeowners over the coals for their own personal gain, and without any morals or scruples. I guess you could say there were a bunch of Bernie Madoff’s in the loan modification business.

      From what we could tell, the Attorney loan mod scammers often were either the “newbie” Attorneys who had no clue what was going on and didn’t care (and may have had a hard time finding legal jobs in the tough economic climate following law school) and/or 20 or 30 year attorneys who could care less whether or not the State bar stripped their license to practice law (I think some of these attorney violators were racking up so much money, and trying to ship it off-shore for their retirement purposes). In fact, we heard one Southern California Attorney, who was disbarred for his loan modification shennanigans, had over 1,700 loan files that he had charged over $6,000 a piece to help modify their loans (yes, that is about 11 million dollars). This information was relayed to our office by the Federal Trade Commission (FTC) who helped stopped the attorneys scam, and put the joker out of business.

      Other attorney/brokers that we have seen have been callous and calculating, and when approached with demands for loan modification refunds, have simply said “if you sue me I will file bankruptcy…” This is the attitude of a lot of scammers.

      There was one scammer that our office dealt with, Mr. Jason Adelman of Bakersfield (we believe he was runnning a Nevada Company), who agreed to settle his loan modification scam suit, but then disappeared starting up a new “Investment” company in the Bakersfield area. Our information also shows that this guy is a youth football coach and/or little league coach in the Bakersfield area. This guy failed to have an approved advance fee agreement, and failed to perform reasonable services or provide refunds upon demand.

      This is just a flavor of the things we saw from the loan modification side of life in 2010. Taking this for what it is, and given the large number of complaints from California homeowners dealing with these types of heartless vultures, it is no wonder SB 94 was passed.

      Now some “enterprising” lawyers (one in particular in southern california) have broken their loan modification contract into THREE PIECES (charging for each service after it is performed) in an effort to snub their noses at SB 94. This particular firm is also bringing in about 200 files per month, or so we are told. This is the nature of the loan modification beast in California, and homeowners are advised to be very suspect and wary when dealing with a loan modification company. Do not pay any advance fees for loan modification work to either an attorney, “law center,” “law group,” “Attorney-based” company, foreclosure consultant etc. – Source

      The California State Bar Association Weighs in:

      S.B. 94 was effective on Oct. 11, 2009. New Business and Professions Code Section 6106.3(a) provides for the imposition of discipline if a lawyer violates Civil Code Section 2944.6 or 2944.6. Generally, this new legislation prohibits a lawyer from charging, collecting or receiving any advance fees or other compensation until after the lawyer has fully performed each and every service for the client. The State Bar’s Office of the Chief Trial Counsel has indicated that it will enforce the statutory language consistent with the State Bar’s interpretation of the new statutory language. – Source

      [SB94] prohibits attorneys and any others involved in mortgage relief from taking upfront fees for loan modification work. Weiner said the new law should reduce the number of lawyers committing loan modification misconduct. – Source

      Another attorney weighs in:

      The State Bar’s WRITTEN GUIDANCE DOES NOT PROHIBIT LAWYERS FROM BREAKING UP SERVICES RELATED TO A LOAN MODIFICATION INTO CONTRACTUAL SEGMENTS, PAID FOR AS THOSE SERVICES ARE COMPLETED.
      HOWEVER, the Bar’s interpretation of the new law DOES NOT allow attorneys to accept funds in advance into a trust account and be paid from that trust account. The Bar focused on the word “receive” in the language contained in the statute as the basis for their interpretation, stating:
      The legislation prohibits the collection of advance fees for loan modifications, as specified. Among other provisions, new Civil Code Section 2944.7(a)(1) provides as follows:

      “Notwithstanding any other provision of law, it shall be unlawful for any person 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 do any of the following: (1) Claim, demand, charge, collect, or RECEIVE any compensation until after the person has fully performed each and every service the person contracted to perform or represented that he or she would perform.”

      From the California Bar Association again:

      Continuing its effort to protect the public from lawyers who take advantage of distressed homeowners, the State Bar prosecutor’s office has secured orders of involuntary inactive enrollment for Southern California attorneys Eric Douglas Johnson and Mark Alan Shoemaker.
      Besides the two involuntary inactive enrollments, the State Bar’s Office of Chief Trial Counsel has obtained the resignations of 13 attorneys involved in loan modification misconduct since creation of the Loan Modification Task Force in April 2009. Five loan modification trials are pending. Another 2,000 active investigations related to loan modification are being conducted.

      In separate May actions, State Bar Court Judge Richard Honn ruled that the conduct of Johnson (State Bar #224065), 55, of Los Angeles, and Shoemaker (State Bar #134828), 49, of Long Beach, pose a “substantial threat of harm” to their clients or the public, and both were ordered involuntarily enrolled as inactive members of the State Bar under Business and Professions Code 6007.

      Johnson associated with several non-attorney legal organizations, lending his name and status as an attorney to a firm offering bankruptcy filing and assistance, a business handling forensic audits and loan modifications and two other loan modification companies. Honn cited cases in which homeowners were promised that their homes would not be foreclosed but the homeowners lost them anyway after having made significant payments to the non-attorney companies.

      Johnson “lacked control and failed to supervise” any of the organizations with which he was associated, Honn wrote in his May 18 order. “This lack of control and failure to supervise consequently led to, among other things, the unauthorized practice of law, misrepresentations and client harm.”
      Shoemaker, whose case was investigated and prosecuted with the invaluable help of the California Department of Real Estate, has owned and operated a loan modification business called Advocate for Fair Lending since 2008. Shoemaker “used Advocate and his status as an attorney to convince cash-strapped homeowners to pay him thousands of dollars in hopes of saving their homes from foreclosure,” Honn wrote in his May 28 order. Shoemaker, however, “often did little to nothing to help these clients. In fact, many of these homeowners were worse off after retaining [Shoemaker’s] services.”
      The order referred to 18 examples in which Advocate clients, who signed power of attorney when they contracted with Advocate, were not helped and asked for refunds. A few did get refunds; many others did not. Some clients reported that their lenders said they had never been contacted by Advocate on their behalf. Shoemaker argued that he was merely the president of Advocate and did not represent any Advocate clients in a legal capacity.
      “Advocate’s clients were also [Shoemaker’s] clients,” Honn wrote. “An attorney cannot use a power of attorney form to absolve themselves of the ethical mandates they have sworn to uphold.” – Source


      BTW,

      I can find no such section. Here is all of 1085.6. Which part are you referring to?

      SEC. 5. Section 10085.6 is added to the Business and Professions Code, to read:
      10085.6. (a) Notwithstanding any other provision of law, it shall be unlawful for any licensee 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 do any of the following:

      (1) Claim, demand, charge, collect, or receive any compensation until after the licensee has fully performed each and every service the licensee contracted to perform or represented that he, she, or it would perform.
      (2) Take any wage assignment, any lien of any type on real or personal property, or other security to secure the payment of compensation.
      (3) Take any power of attorney from the borrower for any purpose.
      (b) A violation of this section by a natural person who is a licensee is a public offense punishable by a fine not exceeding ten thousand dollars ($10,000), by imprisonment in the county jail for a term not to exceed one year, or by both that fine and imprisonment, or if by a corporation, the violation is punishable by a fine not exceeding fifty thousand dollars ($50,000). These penalties are cumulative to any other remedies or penalties provided by law.
      (c) This section shall apply only to mortgages and deeds of trust secured by residential real property containing four or fewer dwelling units.
      (d) This section shall remain in effect only until January 1, 2013, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2013, deletes or extends that date.

      • sophia

        your last reply seemed unbiased in the beginning, but did you have to “ask” me where it says that attorneys are excempted? we can have a casual correspondence over the interpretation of the sb94, not a legal battle. i am not an attorney and i am certainly not as sophisticated as you to defend any one in regards to loan modification and the sb 94.
        as far as i can see, you are still only revealing the sections that best strengthens your aggression to loan modification companies. really now, the section that you have typed out excludes (5) of the code. you are disrepecting the common sense of your consumers, your last two replies clearly show that you are not here to educate the consumers of this law, rather you are here to scare the hell out of the consumers who are in a situation where they do not know where to go.what are you getting out of this? i may be in error, but you seem like someone that got scammed out by the bad loan modification companies.
        but neverthless, this is going no where. you do what you have to do on your vendata against the loan modification companies, meanwhile trashing some of the good ones since you fail to differentiate a real sheep from a wolf in a sheep’s disguise. there is going to be a very distraught consumer who may be facing foreclosure who will not seek the advice of good loan mod company because of your comments here stating the law to benefit your argument. that same distrayght consumer will apply for a loan modification directly to the bank and for any of the numerous reasons(really excuses) the mod will be denied. that same person more than likely would have recieved a succesful loan modification if a trained loan modification company had helped them. at the end of the day, the home will be foreclosed when it did not need to be. so, STOP meddling into other people’s good intentions and succesful outcome. only go after the bad ones, and support the ones that are good. the sb94 was enacted to eliminate scammers, not those of us that actually works for our clients.
        this “legal arguments” from you with “supporting source” must be thoroughly researched and completely fair. you failed to do neither.
        if you are crusading in the justice and interest of the consumer please provide all info out there fairly and factually.
        this is my last reply to you. i do not want to waste any more time with you unless you can provide better truth than what you have written.
        as for others, you may reply to my comments and i will reply back

        thanks to all that read this.

      • http://GetOutOfDebt.org Steve Rhode

        I asked because the section number you quoted me does not exist in 1085.6. There is no section 5.

        Only reveling the section that best strengthens my aggression? Really!

        Let me ask you two simple questions.

        1. What is the name of the attorney that is your office everyday assisting consumers?
        2. Are you in full compliance with the ethics opinion from the California Bar on collecting advance fees?

        Steve

  • sophia

    as you may be aware, i am not an attorney that can interpret the law that you are discussing here, the sb94. but the law has exceptions that states taht attorneys can legally accept fees prior to succesful modifications. furthermore, the law was enacted to proect against foreclosure consultant from taking advantage of distressed homeowners. the foreclosure consultants are the ones that you need to expose. a proper loan modification company should have an attorney, as well as licensed through the DRE.
    i am not here to argue for or against any loan modification companies. only to encourage the consumer to be open minded and differentiate fraudulant loan mod companies to an honest one.

    • http://GetOutOfDebt.org Steve Rhode

      The state law also applies to lawyers. The law says “prohibit any person, including a real estate licensee, who negotiates, attempts to negotiate, arranges, attempts to arrange, or otherwise offers to perform residential mortgage loan modifications or other forms of mortgage loan forbearance, as specified, for a fee or other compensation paid by a borrower, from demanding or receiving any preperformance compensation, as specified, requiring any security as collateral for final compensation, or taking a power of attorney from a borrower, and would make a violation of that prohibition a misdemeanor or subject to specified fines. By creating a new crime, the bill would impose a state-mandated local program.”

      More specifically when it comes to lawyers the law does provide an exception, but this is it:

      “Any person licensed to practice law in this state, not actively and principally engaged in the business of negotiating loans secured by real property, when that person renders services in the course of his or her practice as an attorney at law, and the disbursements of that person, whether paid by the borrower or other person, are not charges or costs and expenses regulated by or subject to the limitations of Article 7 (commencing with Section 10240), and the fees and disbursements are not shared, directly or indirectly, with the person negotiating the loan or the lender.”

      Show me how you comply and where you are registered to offer loan modification services. As far as I can see, no matter what your arguments are, you are operating by collecting an advance fee.

      “The term “advance fee” as used in this part is a fee, regardless of the form, claimed, demanded, charged, received, or collected by a licensee from a principal before fully completing each and every service the licensee contracted to perform, or represented would be performed. Neither an advance fee nor the services to be performed shall be separated or divided into components for the purpose of avoiding the application of this section.

      (a) Notwithstanding any other provision of law, it shall be unlawful for any licensee 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 do any of the following:

      (1) Claim, demand, charge, collect, or receive any compensation until after the licensee has fully performed each and every service the licensee contracted to perform or represented that he, she, or it would perform.

      • sophia

        the law in its entirety is not explained fully in this site. you do direct where the law is on your previous comments. but it seems like that you are typing out the portions of the law that best suit your argument. but i do know of one thing that my 9-5 job has constantly taught me, and that is no one can perform the modification of any loan for any body except the bank. we are not offering loan modification on clients loan, that is the job of the bank that their loan is with. rather we are offering a service to assist in reciving a succesful loan modification. furthermore, you state that you dont mind escrowing the funds into third party. and you also stated that when a succesful loan modification is not granted, the money should returned. so should a loan modification company who has a place of business with overhead and with attorney costs, should render service and give money back if at any reason whether the consumer could not provide supporting docs to the bank foreclosing on the consumer etc. etc.? i mean i can understand that if the loan modification was in fact negligent on services that was expected, then i can see money being returned. and i have to tell you, i have seen plenty of times when the owner of my company has given back every dollar to the client. just last week, a client came in on the 17th and signed and paid in full (to 3rd party account). that clients home was foreclosed on the 15th, the client found out 2 days after signing with us. we voided her contract returned all her money and negotiated better term with her bank in her favor all for free. i personally spoke to client and the realtor who represents the bank. not one nickel was charged to this woman who lost her home. but if the case was assigned an attorney, we could not have returned all her money. this case was no one in my company’s fault. still, we spent time and office resource to aid her.
        still more, i have a client who lost his home shortly after signing with us. he was thoroughly informed of all risks involved with his transaction. we spoke to his bank prior to his signing to ensure that his loan modification application will be accepted. we spent a weeks time between my supervisor, the processor, client’s bank and the fannie mae. the phone calls on the day of sale began at 6 am here for me because fannie mae and flagstar was 9 am in the east coast. after 4 hours of nonstop calls to everyone, then continuimg correspondence with fannie mae, the sale took place and the home was returned to the bank. that client and us are still corresponding. last i spoke to the client was 3pm yesterday. not one dollar was ever charged to that client by us. any other company may have charged a fee, but because of his special circumstances, (he is in the last stages of cancer, he started to lose his sight, and his passing is eminent.)
        i have plenty more that i can write about and document them to be true. this is just examples of what we do despite all negative criticism.i cant speak for all other companies out there, but i can tell you that we operate with ethics and empathydaily so that we can sleep in peace at night. and any employee caught lying to a client here gets fired. that is what we are told at company meetings and at our initial interviews.

      • http://GetOutOfDebt.org Steve Rhode

        How do explain not being registered as required?

      • http://GetOutOfDebt.org Steve Rhode

        Here is the link to SB94 so you can read the entire law.

  • sophia

    by the way, we charge a retainer at signing. the fees do not come directly to us, we are in compliance with sb94. i know of only 1 company that do not charge at initial signing. but their fee is considerably higher, almost double. they do collect full payment when trial mod is offered to client no matter what the outcome of the terms are. a lot of their client do not pay them for services rendered, some of their clients do pay. so the average fees collected overall is similar to ours. in plain english, revenues to the company is similar. it is not fair for those client that actually pay because they are really paying for others that do not pay.

    • http://GetOutOfDebt.org Steve Rhode

      Are you saying at Provident you make no deduction and take no draw from the escrow account until the modification is complete?

      • sophia

        no, i said i know of only one company that does not take money at signing of the initial retainer agreement. they take their fees at trial offer. not whenit is completed.

      • sophia

        i understand and accept all skepticism in regards to fees for a loan modification company.
        but the reality is if the loan modification company does not secure their fees at the least with a trust account/escrow account, that company will go belly up due to lack of collection department. more clients blow off paying their fees than those that do pay. i do not know a single law firm outside of loan modification firms that do not charge a retainer fee for legal services, and they collect filing fees if any. why does loan modification law firms get so much slack for trying to get paid on services that they provide?

      • http://GetOutOfDebt.org Steve Rhode

        I don’t have any problems with funds being deposited in escrow but if the modification is not obtained then the funds should be returned. According to SB94 it seems clear that fees may be charged or collected for loan modification work but only taken when the modification is completed. In California it seems very clear the Attorney General has said this is not a service where a consumer is paying for processing they are paying for a successful modification.

        If you think I’m wrong in that interpretation please direct me to that section of California Law SB94 that allows for any fee to be collected or taken from the consumer or escrow account prior to the modification being granted by the lender.

        And by the way, according to the California Attorney General loan modification site, Providen Law Group is not registered to provide loan modification services. The site says “Provident Law Group” is NOT a registered Foreclosure Consultant. The site also says, “Do not pay any money up front (it’s illegal for any foreclosure consultant to take money before the work that was agreed upon is complete).”

        “After July 1, 2009 it is illegal to operate as a mortgage foreclosure consultant in California unless the foreclosure consultant has obtained from the Department of Justice a Certificate of Registration as a Mortgage Foreclosure Consultant.”

        Does the foreclosure consultant I’m thinking of doing business with have a Certificate of Registration from the Attorney General’s Office? Does it matter?

        Yes, it matters! You should not do business with a foreclosure consultant who does not have a Certificate of Registration because this person should not be doing business as a foreclosure consultant at all.Source

        Steve

        P.S. Anyone who feels they have been misled or has not received the service they have paid for, this guidance from the California Attorney General’s office may help.

        The California Attorney General’s office suggests filing complaints with these offices.

        California Attorney General’s Office

        Federal Trade Commission

        California Department of Real Estate

        State Bar of California

        They also say “You may also wish to consider filing a Small Claims Court action. These are informal courts where disputes are resolved quickly and inexpensively by a judge. You can recover up to $7500 in Small Claims Court. You represent yourself and can request a judgment for monetary damages.”

  • sophia

    so it is 5:30 am, i am sitting in my kitchen reading these comments and clicking on the sites.
    people, i retained 2 different loan modification companies for few of my investment properties when the mortgage meltdown took plce. after wasting almost 10k with modification companies pre-Obama bail Out plan. now, i work in loan modification company after getting ripped off for services that never materialized. when i spent nearly 10k expecting a positive turnout, my mortgage payments, all $14,500 to institutional lenders were all current. the mod specilist i signed up with told me not to pay my mortgages. if i am current, i will not recieve a mod. 10 monthes later, i still did not recieve a mod, and credit went to crap. out of desperation, i hired another loan mod company. same thing. just a waste of time, alot of unresearched advises, and at the end, foreclosures, bad credit, and a whole lot of aggrvations and stress. by this time my financial life was on life support.
    then i saw an ad for a job position with a loan modification company. this company is in full compliance with all licensing requirement and after my interview, i got the job as a case manager. Even after i started the job, i was
    still skeptical of an actually true and succesful loan modification company. for the first couple of weeks, i didnt think i was in the right place. majority of my business collegues prior to my commitment in the loan mod company didnt even know that i had a new job. (i am a real estate investor, ie: flipper) but with a very ethical supervisor, and an environment where we are always told never lie to a client, i love my job. now everyone i know including my private lenders, real estate brokers, and my city of oakland building department etc, know that i have a 9 to 5 job. i still flip houses as my major force of income. but my day to day committment in my loan mod company( i cannot disclose the name of the company) has enriched me, my collegues, and the clients that i have helped.
    folks, there really is an honest loan mod company. i am working in one. i sell valuable services. my supervisor, an ex-executive for a closed publishing company, will not let me take any clients who believe has less than 95% chance of recieving a loan modification! we bump heads sometimes, because some of the clients he declines does have a good chance of a succesful loan mods, just not the percentage that he is comfortable with! but because of this, our clients in Team P, have almost perfect success rate. and i am proud to say that i am committed to help my clients here.
    loan modification is not science. its just alot of work that takes up a whole lot of time. and servicers like my company provides services that clients do not have time to do themselves. and yes, anyone can apply for a mod program themselves for free. but no one will do it for free for another. when i go to safeway, i can buy really good lettuce for less than a dollar. i can also buy a rib-eye there for less tahn 10 dollrs. all in all, i can have a delicious dinner with salad for less than 11 dollrs. the same dinner will cost me $29 dollars at a restaurant. the $18 differences is the service i recieve when i dine at a restaurant rather than my kitchen. same concept here. we charge a fee so that we can help our clients to have a succesful loan modification.
    thanks for reading my comment.

  • Confused

    I am at a loss right now. I am dealing with Liberty Law Group, now I am getting second thoughts. I originally was going to deal with another Law Firm in Santa Ana…Who is the honest person?? Who am I suppose to believe? I am so very frustrated.

    • http://GetOutOfDebt.org Steve Rhode

      Why not just deal with your lender directly and stop paying others?

      Steve

      • sophia

        anyone can do that. just like everyone can file their own taxes. why do people pay their CPAs to file taxes?
        do you believe that EVERYONE can complete their modification directly through their lender.Let’s not kid ourselves.
        the actual loans can also be originated directly by going to the bank as well. listen to these stories and you will understand why the loan modification company can be of service to consumers, not just a tactic to profit for no services.
        i dont understand why you are so intent on Provident Law when there are a whole lot of other companies that just take consumers money and produce no work on their behalf. if an honest law firm has to show billable hours to the clients case work, do you really believe that can be accomplished with the fees that a typical loan modification company charges? i know of no attorneys, except pro bono, that charges less than 125 an hour

      • http://GetOutOfDebt.org Steve Rhode

        You might have missed my response to one of your other comments addressing this so I’ll post it here again for you.

        I don’t have any problems with funds being deposited in escrow but if the modification is not obtained then the funds should be returned. According to SB94 it seems clear that fees may be charged or collected for loan modification work but only taken when the modification is completed. In California it seems very clear the Attorney General has said this is not a service where a consumer is paying for processing they are paying for a successful modification.

        If you think I’m wrong in that interpretation please direct me to that section of California Law SB94 that allows for any fee to be collected or taken from the consumer or escrow account prior to the modification being granted by the lender.

        And by the way, according to the California Attorney General loan modification site, Providen Law Group is not registered to provide loan modification services. The site says “Provident Law Group” is NOT a registered Foreclosure Consultant. The site also says, “Do not pay any money up front (it’s illegal for any foreclosure consultant to take money before the work that was agreed upon is complete).”

        “After July 1, 2009 it is illegal to operate as a mortgage foreclosure consultant in California unless the foreclosure consultant has obtained from the Department of Justice a Certificate of Registration as a Mortgage Foreclosure Consultant.”

        Does the foreclosure consultant I’m thinking of doing business with have a Certificate of Registration from the Attorney General’s Office? Does it matter?

        Yes, it matters! You should not do business with a foreclosure consultant who does not have a Certificate of Registration because this person should not be doing business as a foreclosure consultant at all.Source

        Steve

        P.S. Anyone who feels they have been misled or has not received the service they have paid for, this guidance from the California Attorney General’s office may help.

        The California Attorney General’s office suggests filing complaints with these offices.

        California Attorney General’s Office

        Federal Trade Commission

        California Department of Real Estate

        State Bar of California

        They also say “You may also wish to consider filing a Small Claims Court action. These are informal courts where disputes are resolved quickly and inexpensively by a judge. You can recover up to $7500 in Small Claims Court. You represent yourself and can request a judgment for monetary damages.”

  • Shawna

    Dear Steve,

    I truly appreciate not only your posting of this information but also the follow-up questions you’ve asked of the company.

    My husband and I bought a house at a price that fell within our two-income budget. Then, my husband lost his job of 7 years. We’ve only ever paid cash for everything…except our house, so the loss of job and threat of losing our home was devastating. We approached our bank and they had us walk various paths to reach an outcome but none have helped. One of the bank associates actually recommended! this group. I was immediately suspicious and went internet hunting. Thanks to your site, and others, my suspicions have been proven true.

    The company provides no hard data for how many successful cases they’ve had or even references that can be checked. Thank you for helping me save the money they were asking for. I’m going to be emailing my bank and telling them that recommending this company was at best insulting and at worst unethical.

    My husband and I have since contacted HUD and they’ve informed us that every “path” our bank has had us walk has been nothing but a waste of time.

  • Sandra

    Again, Legal Department, you have things all wrong. What a surprise. Provident Law Group knew well the reasons I had sought out modification of my mortgage before they informed me that they would be assisting me. After my accident I have became disabled due to restricted use of both arms. I was not in foreclosure then and was told NOT to communicate with my lender as Provident had worked with them many times before sucessfully.

    What has not changed is the fact that Provident is lying to people on the phone and charging them through an escrow company before they lift a finger. If the date I gave for the funds had been followed there would have been no action taken by Provident anyway. Provident would not have returned my calls or answered my emails, rather they would have kept the money and ran. I will not lower myself to communicating with Provident through this medium further. I feel your hostility is caused by someone catching you with your hand in the cookie jar before you got your cookie. If you are an attorney (lol) you would not be airing your dirty laundry here. The truth of the matter is that you charged up front fees which is against the California Law and so Provident needs to be taught that there are consequences to illegal actions.

    My question for the esteemed Steve Rhodes is what kind of actions are possible for the victims to take against this company?

    • http://GetOutOfDebt.org Steve Rhode

      Sandra,

      The California Office of the Attorney General has a special website to fight loan modification fraud and that might be the avenue you are looking for. You can visit the site by clicking here. On the site it has a link for people to file a complaint. The link to file a complaint with the California Attorney General is here.

      The Attorney General loan modification site can also be used to check and see if a company or person is licensed to offer loan modification services.

      Since I was on the site I checked to see if Provident Law Group was a registered foreclosure consultant and got back “NO, “provident law group” is NOT a registered Foreclosure Consultant.” I also checked Jeffrey Cancilla and got back “NO, “Jeffrey Cancilla” is NOT a registered Foreclosure Consultant.”

      The Attorney General site says:

      Does the foreclosure consultant I’m thinking of doing business with have a Certificate of Registration from the Attorney General’s Office? Does it matter?

      Yes, it matters! You should not do business with a foreclosure consultant who does not have a Certificate of Registration because this person should not be doing business as a foreclosure consultant at all.

      The Attorney General site also suggests that you can file complaints also with the California Department of Real Estate, California State Bar, and the Better Business Bureau.

      As an additional avenue to get help the Atorney General site also says:

      You may also wish to consider filing a Small Claims Court action. These are informal courts where disputes are resolved quickly and inexpensively by a judge. You can recover up to $7500 in Small Claims Court. You represent yourself and can request a judgment for monetary damages. Visit the California Courts Self-Help Center for further information.

      Steve

  • Legal Department

    This false post of May 18, 2010, is patently untrue. The post claims that, “Liberty Law was an outgrowth of a company called Noah Savings.” In fact, Liberty Law Group originated from attorney, Brian J. Colombana, changing the name of his company “Housing Law Group;” dba “Mortgage Relief Law Center;” dba “Law Offices of Brian J. Colombana.”
    Liberty Law Group is registered with the Better Business Bureau, in fact stating its address is: 3105 East Guasti Road, Ontario, CA 91761, Tel: (866) 630-0023, Fax: (909) 481-0124. The related site link hereto is: http://www.la.bbb.org/Business-Report/Liberty-Law-Firm-100078220. Thereon, it states the attorney of record is again, Brian J. Colombana.

    In one of Steve Rhode’s prior blogs, of April 15, 2010; he rumored that, “I’m curious if anyone has used the loan modification services of a company that was called American Financial Modifications and they are now called Liberty Law. – Source”
    Further indicating thereon, “There are two sites for California companies that say they are Liberty Law Firm. See llfirm.net (source) and libertyfirm.org (source). The toll-free number for American Financial Modifications and one of the Liberty Law Firm sites is the same, 866-868-3090.”
    In fact in that earlier blog, it states that, “The only attorney I (Steve Rhodes) could find that was tied to a Liberty Law Firm was a Brian J. Colombana. He is related to LibertyFirm.org through the BBB listing. – Source. And according to this online complaint he is or was also associated with Mortgage Relief Law Center (source) and Housing Law Center (source).
    Apparently Brian Colombana was also the owner of Colombana Financial, Inc and Fast Pace Funding. These entities were shut down by the State of California in May 2009 and the California Finance Lenders License was revoked (source) and the corporation is now suspended.

    I asked Brian about the up-front fees, if he was the attorney for Liberty Law and American Financial Modifications.
    He said, “I am an attorney of record for Liberty Law Firm. We have a few others as well. We were never known as American Financial Modifications though”
    Brian Colombana replied in that blog that, “I saw your post and there was a couple of things I wanted to comment on. My real estate companies have nothing to do with Liberty Law Firm, Inc. They were never shut down by the State of California. See http://www2.dre.ca.gov/PublicASP/pplinfo.asp?License_id=01791351. Colombana Financial, Inc. is still active, licensed, and in good standing with the Department of Real Estate. I had a mortgage company (Fast Pace Funding) with dual licensing under the Department of Real Estate and the Department of Corporations. When the mortgage market went south, I let my licensing under the Department of Corporations expire. I simply didn’t renew for the next year because I didn’t need to. There was no investigation, no administrative proceedings, just a notice because I failed to renew.”
    As stated in your blog dated May 18, 2010, “The ProvidentLaw.com domain name was registered on March 29, 2010 and Provident Law Group was registered on April 1, 2010 and the agent of service is Jeffrey Cancilla, 1748 W. Katella Avenue, Suite 112, Orange, CA 92867. – Source”
    Since 1992, Provident’s founder and principal attorney, Jeffrey A. Cancilla, has been providing legal services to the Oregon, Arizona, and Southern California communities’ altogether. Currently, Jeffrey Cancilla provides legal services in the areas of Bankruptcy, Foreclosure, Mortgage Litigation, and Loan Modification.
    Jeffrey A. Cancilla, Esq., has over 15 years legal experience in both government and the private practice of law, including bankruptcy, and is admitted to practice law in Federal Court. In addition to the full-time practice of law, Mr. Cancilla is a published author of legal educational materials.”
    Mr. Cancilla is a member of The National Association of Consumer Bankruptcy Attorneys (NACBA), The Central District Consumer Bankruptcy Attorneys Association (CDCBAA),
    and Consumer Attorneys Association of Los Angeles (CAALA). Jeffrey Cancilla is also admitted to all federal bankruptcy district courts in California, including the Central District, Southern District, Eastern District and Northern District.
    As a result of its exemplary conduct, industry and ability and its investment of time, financial resources, advertising, promotion, experience, care and service; Jeffrey Cancilla has acquired a stellar reputation and is known as a highly-regarded law firm providing client-focused interdisciplinary services that result in high-value legal counsel for its clients.
    At all times mentioned herein, Jeffrey Cancilla has possessed a reputation for fair dealing, courtesy, and accommodation, for providing quality legal services to the general public, and which reputation was, and is, of great value to Jeffrey Cancilla. Mr. Cancilla has an “A-“rating on the Better Business Bureau website. Jeffrey Cancilla has been in the loan modification industry for the last 2.5-3 years, since its inception after the mortgage meltdown in late 2007 and early 2008.
    As far as the telephone loan modifications go, whoever this “current Liberty Law franchise employee” is, once again they are not someone working for Provident Law Group; as the two companies are not affiliated. Your “confidential source” is grossly mistaken on the two companies, and similar to lumping Colombana in with purported employees of American Financial Modifications later being called Liberty Law; herein you are indicating that Jeffrey Cancilla, who founded Provident Law Group, is also associated with Liberty Law Group; which is false.
    In your blog you say, “I am told that Provident Law Group is thinking of re-launching the Liberty Law product of $995 telephone loan modifications. It is alleged that the Liberty Law target market for this service were Hispanic and blue-collar consumers that were less likely to understand what they were being sold.” Once again Provident Law’s Jeffrey Cancilla is not affiliated with Liberty Law Group’s Brian Colombana, and/or any of their purported former products.
    If this defamatory article with infringing content is not taken down, and/or the confidential source is not revealed, Provident Law Group will have no choice but to file a complaint for damages for Defamation Per Se; Trade libel; Tortuous Interference with Business Relations; Tortuous Interference with Prospective Business Relations; and Unfair Competition and Business Practices (California Business & Professions Code §§ 17200, et seq.); against Steve Rhodes.
    Provident Law Group is dumbfounded and amazed at the misinformation that has been given to Mr. Rhodes on our company. If you check with the Secretary of State, one will see that Jeffrey A. Cancilla, Esq., is the sole owner of Provident Law Group. Anyone other specific individuals’ names that are mentioned in this blog are mere employees of Provident Law Group; nothing more.

    I note there are some upset clients and some upset people who weren’t actually our company’s clients but when I’ve taken over thousand or so clients over the last two years, some complaints are inevitable. For every one person that complains, I have 100 others that are satisfied.

    Through this article, Provident Law Group is now well aware of the purported one (1) independent contractor; and thereafter two (2) clients, who were upset with our services and proceeded to defame us all over the internet. Keep in mind that this is a ridiculously small fraction of our clientele; and we have successfully modified hundreds of files, if not thousands. We have not been investigated by any agency; and even if we were, we could show them all of the work we have done on each file. Most of our clients have been very impressed with the amount of work we devote to their file, and the result that comes out of it. Apparently these clients did not feel the same way.

    • http://GetOutOfDebt.org Steve Rhode

      Dear Anonymous Legal Department,

      Since you appear to represent Provident Law Group maybe you can clear up some information and help set the record straight and provide clarity.

      1. Can you assure readers that Provident is not collecting any money or advance fees before a permanent loan modification is obtained and that no fees are collected from consumers, placed in escrow and charged against before a permanent loan modification is obtained.

      2. Since a look at the State of California records only shows the registered agent, are you confirming that Cancilla is the sole owner of Provident and is responsible for all management and business operational decisions and/or that Tom Duong has no relationship to Provident at all?

      3. What is your explanation that Noah, Liberty and Provident all listed the same address and suite number as their place of business but you now say they are not related. Did they sub-lease from each other?

      4. You never answered my previous question why the computer you keep posting from was also used to post comments from David (slamming me with lies) and Joseph (a purported happy consumer).

      5. Can you please identify yourself so we can have an open conversation?

      6. Can you please share what your success rate is for obtaining permanent modifications is from the consumers that pay for services from Provident and tell us how much the services you offer are?

      Your cooperation in this matter will help to clear up any confusion or misinformation people may have about Provident.

      Steve

  • Joseph A.

    I have worked with Provident Law Group and found that their attention to detail and straight forward approach made it easy for me to use their service. The have been very consistent contacting me and keeping me in the loop about my home. I haven’t found any “hidden” aspect of the work their doing for me. I know it will end up costing me money, and I know that there is no gurantee that I’ll be able to save my house from foreclosure. The case manager I spoke with over at Provident Law (Adam) made these issues very clear to me. I tried working with my mortgage company, Bank of America on my own and found it to be very frustration, time consuming and difficult to get any sort of striaght answers from people there. The reason I went with Provident Law Group is because a co-worker was happy with them and gave me there information. All be it disheartening to read the information posted on this site, I still feel as though I am in good hands, espeacially after being referred by someone I’ve known for many years. So far I’m very please with the progress of my case and based on the individual circumstances I am faced with, I wouldn’t loose any sleep refering a friend or family member to Provident Law. They gave me straight answers and sent very clear documentation regarding my agreements with them. My advise to anyone looking in to this, (or anything else for that matter): …Take it with a grain of salt!

    • http://GetOutOfDebt.org Steve Rhode

      Joseph,

      Any explanation why your computer was also used to post the comment from David that was slamming me?

      Steve

  • http://www.scamchecker.com/content/steve-rhode-getoutofdebtorg-myvestaorg-beware-steve-rhode-and-getoutofdebtorgthis-company-fr David

    Steve Rhode – getoutofdebt.org http://www.GETOUTOFDEBT.ORG
    Steve Rhode getoutofdebt.org – Myvesta.org Beware Steve Rhode and getoutofdebt.org…this company is a fraud Internet
    Submitted by thetruth on Tue, 03/30/2010 – 01:48 in Computers & Internet
    getoutofdebt.org
    United States
    SCAM REPORT:
    I am a consumer from the Washington, DC area, and I came across what I consider one of the typical fraudsters that you find on the internet these days that I think needs to be exposed. This guy seems to have a national audience, which makes him even more dangerous.

    First, some background. I am 48 years old. I work in the federal government (I’m not writing this at work, by the way). I am in debt. Like many people, I Googled “get out of debt” since I would like to get out of debt. Pretty basic, huh?

    As usual, there are various results in the Google search, and I am a pretty skeptical person. So, I click on a few links to see what I can find. One link was from the guy on CNBC at night that’s always talking about how he was bankrupt. Another was a link to a site called getoutofdebt.org. Another was a link to Lending Tree (you know the company with the commercials about banks competing?).

    Anyway, after browsing the aforementioned links for a few minutes, I decide to spend a few more minutes on the getoutofdebt.org site. It looks pretty good, and it seems to be relevant. The first thing that I notice about the site is that it’s written by a guy named Steve Rhode. I don’t know him from Adam, so I Google him, too. As I’m browsing the results from the search, everything looks legit. Lots of quotes from Steve in various news organizations, etc. Of course, Steve, just like the CNBC, claims to have gone through bankruptcy, which is why he is an “expert” now. A few pages in, I find that Steve has written a book on the topic. Okay, so now I know that Steve is using his website to drive book sales. Typical, but, the man has to make a living, I guess, even if he is just using his “free” website to sell his books.

    So a little further in to the search results, I notice that Steve is linked to an organization called Myvesta, which claims to be a non-profit. So, I Google “Myvesta Steve Rhode”. And there it is…exactly what I expected to find, since nearly every so-called “guru” is not really that and usually has a shady past. As it turns out, Myvesta, which used to be known as Debt Counselors of America, has a cease and desist order from the state of California, which is known for aggressively pursuing fraudulent activities by companies such as this. Turns out our “guru” is out peddling debt advice and California has shut him down for not complying with California law. And, our so-called “non-profit” is apparently selling a $200 per month “debt payment” plan. What a complete and total fraud! Thank heavens for Google!

    So, yet a little further in to these search results, I learn that Steve and his co-founder were forced to resign from the company in late 2003. Ah, but this gets better. Steve resigned and appointed his wife as the President…so, Steve commits fraud, the state of California pursues him, and then he appoints his wife to run his company. Yeah, things have really “changed” at Myvesta, the non-profit charing a $495 enrollment fee and a $200 per month “maintenance” fee.

    Needless to say, after figuring all of this out, I decided to keep looking for a reputable site, so if you find one, let me know. I hope this helps expose Steve Rhode, Myvesta and getoutofdebt.org for the complete and total fraud that it is!

    • http://GetOutOfDebt.org Steve Rhode

      This is very similar to another false post that appeared about me on another site. It is patently untrue.

      The poster claims I sell my books. In fact I give away my books for free. the link it in the lower right hand side of the site.

      I spoke about the craziness of the California thing a long time ago on my own site. The statements the poster makes is not true. Click here.

      I was not forced to resign. If anything, my temporary departure as president of Myvesta could be best described as a sabbatical. I did take one year off as president but continued to serve as chairman of the board. I took the year off because I realized that over the years of founding and growing the non-profit group I had spent more time with the organization than with my daughter who was soon to graduate from high school and go off to college. I wanted to spend more time with her. I returned to my position of President of Myvesta a year latter.

      We had no $200 a month program at Myvesta. At Myvesta we had a number of programs that were offered. They ranged from simple debt advice to the first ever inpatient treatment center for compulsive spending issues and money disorders. We helped people from finding a job to dealing with tax issues and managing their finances. We had a talented and special staff of experts to assist debtors with professional services. Mediations, Negotiators, Attorneys, Tax Experts, CPAs, Financial Planners, Psychologist, Lending Experts, Human Resources, etc. Some programs had fees for these professional services but no program I remember ever had a $200 a month maintenance fee.

      Steve

    • Legal Department

      As this article defaming the writer, Steve Rhodes, as illustrated, the problem with the Internet is that anyone can be easily defamed, and it is very difficult to find and/or remove the infringing content, to clear one’s name.

      Steve Rhodes goes on to reply, “this is very similar to another false post that appeared about me on another site. It is patently untrue…” Well Steve we know how you feel, but all it takes is upsetting one person the wrong way, friend or foe, and they turn to the Internet for revenge. In our case, we believe your confidential source to be a disgruntled independent contractor who was rightfully ‘let go’ after being with the company a long time, for specific reasons.

      The reader’s can view Steve Rhodes original posting of this blog on Scamchecker.com, entitled: “Steve Rhode getoutofdebt.org – Myvesta.org Beware Steve Rhode and getoutofdebt.org…this Company is a Fraud Internet,” Submitted by thetruth on Tue, 03/30/2010 – 01:48, located at: http://www.scamchecker.com/content/steve-rhode-getoutofdebtorg-myvestaorg-beware-steve-rhode-and-getoutofdebtorgthis-company-fr.

      Likewise, Steve’s Rebuttal and Explanation hereto entitled, “Debt Relief Expert With Background You Don’t Know About,” located at: http://getoutofdebt.org/16877/debt-relief-expert-with-background-you-dont-know-about.

      • http://GetOutOfDebt.org Steve Rhode

        I guess now that you published that eroneous scamchecker report about me I get to “Defamation Per Se; Trade libel; Tortuous Interference with Business Relations; Tortuous Interference with Prospective Business Relations; and Unfair Competition and Business Practices (California Business & Professions Code §§ 17200, et seq.); ” as well.

        Who the hell are you?

        Steve

  • Sandra

    I recently became involved with Provident Law Group Inc. through an internet advertisement for mortgage refinancing. The contact person was James Wegelin who requested that I fill out a form and he would let me know if their firm would represent me. Within 24 hours I was informed that they had decided to take on my case. After listening to the details of my case he assured me that they would be able to work within my limited resources and that they had a very good working relationship with my lender.

    Without my knowledge an escrow company charged a $500.00 fee to my bank account which caused the account to go into the negative. I immediately contacted Mr. Wegelin and he informed me that there must have been some mistake and that he would look into it.

    I checked my account and called my bank when Mr. Wegelin said that the funds had been returned but the bank said it did not receive any transfer. I called him and there was no answer and no response to my emails.

    When I Googled the Provident Law Group Inc. I found out that they are trying to charge an upfront fee that is against the California law by using Escrow companies. It was during this search that I found getoutofdebt.org.

    Today I received a check for the amount taken from my account but it in no way covers the cost to me due to the fees charged and the time lost in finding a way to keep my home.

    I sent an email to Mr. Wegelin stating that they are responsible for the fees and he said that it was a verbal agreement and that papers I signed would be given precedent over anything that he said when on the phone.

    All during this time he had told me not to communicate with my lender and to have my lender contact them. Today he said on the phone that they were not taking my case. Had I known this earlier it may have given me a chance to keep my home.

    I am an older single woman with disabilties after an accident that cause me to lose my employment. Since the fee is considered illegal by California law and this firm is located in Irvine California it would appear that this could be considered fraudulent charge or the firm should be investigated and not allowed to take advantage of those who are seeking assistance.

    • Ann

      I too was drawn into the Provident groups web by Mr. Wegelin. He told me the same thing..do not talk to your lender we will handle everything and we can get your payments down by $300. They simply wanted a voided check for 1500 bucks with two installments of 750 to come out later. An hour before I was to meet with a notary to hand over my life and hopes of keeping my house to them my best friend called. His son in law is an attorney and got suspicious about the voided check thing he did a search and found this article and called me immediately. I called off the meeting and within 20 minutes was recieving desperate sounding calls from Mr Wegelin and someone claiming to be the attorney. Thank God for that or I would have handed over money I have been saving to fix my leaking roof. I contacted the making homes affordable HOPE team and they are helping me for FREE.

      • Legal Department

        Herein, we will refer this individual, a non-client of Provident Law Group, to her original retainer agreement, which was never executed. She never paid our company a dime. She is hereby filing complaints against a company she never entered into a binding agreement with, someone whom she never paid, and a company who donated hours of employee’s time to help her out; as she requested.

        Nonetheless, under the “Additional Recitals” portion of the retainer agreement, it states the following:

        “FREE HUD APPROVED AGENCIES: It is not necessary to pay a third party to arrange a loan modification or other form of forbearance from your mortgage lender or servicer. You may call your lender directly to ask for a change in your loan terms. Nonprofit housing counseling agencies also offer these and other forms of borrower assistance free of charge. A list of nonprofit housing counseling agencies approved by the United States Department of Housing and Urban Development (HUD) is available from your local HUD office or by visiting http://www.hud.gov.”

        Yet, just as Ms. Taylor, in Comment #2 noted:
        “What these (loan modification) companies offer is a better “know how” on getting the modifications approved…Fact is that people want to get paid for their services and there is a lot of phone calls and paperwork to be done during the process of a modification, and anyone who says they work for free is lying.”

        Further on this point, these HUD-approved agencies can even be companies who have applied for the tax-exempt status, who may even have been previously involved with loan modification, mortgage, credit counseling and/or debt industry for profit; in one form or another. Thus, per their tax-exempt status, they are being paid by the government, in one form or another, and are also not working for free. Hopefully, Ann gets the attention and response she is looking for, and we wish her the best!

      • Adam

        Hi Steve,

        I think that guy Jeffrey A. Cancilla ripped me off too. I’m in Maryland and I contacted the Department of Financial Regulation and they say he was never licensed to operate in my state. He was operating as Provident Law Firm and Law Offices of Jeffrey A. Cancilla. How do you think I can get a refund? The guy in Maryland said they would start an investigation but do you think there’s any way I can get my money back? I also just learned that he never actually worked on my file. He outsources processing centers to do all the work. What’s the point of hiring a lawyer if he’s never going to actually look at my case? Please help.

      • http://GetOutOfDebt.org Steve Rhode

        Adam,

        Although this refund process is written for debt settlement refunds it will still be a good approach for your issue as well. Click here.

        Steve

      • Brian
      • Rustymwc

        Did Jeffery A Cancilla really file bankruptcy? OMG!!!

    • Legal Department

      This particular “client” cancelled, and her money was immediately refunded. Therefore, the issue has been satisfactorily resolved, meaning Provident Law Group actually donated hours of employee’s time to help her out; as she requested. Again, we would like to remind Sandra to go through her initial paperwork and detail some of the provisions of the signed retainer agreement, and whether any balance of her retainer fee has been paid. Provident Law Group deserves an accurate record of this account.”

      A borrower always has the right to speak with their servicing company. Nonetheless, while doing a modification, the servicing company, and more specifically, the collection department (if a borrower is past due), also knows this. Therefore, a collection agent may call a borrower confusing them into thinking they are with the loss mitigation department and trying to set up a ‘repayment plan.’ The unsuspecting borrower typically gives confused responses to these trained debt collectors for their servicer, and may completely throw off their loan modification in process, and then any misinformation must be explained/refuted, which the loan modification company must then deal with. It is merely a recommendation for the borrower’s own good, but one that is customarily ignored, even by retained clients; despite them previously ignoring these same debt collector calls even before seeking modification assistance.

      Furthermore, Provident Law Group’s work is broken up in phases. This depends on the timeliness of the borrower’s providing requested documentation and information; a variable that is out of our control. We charge only once we have fully completed a certain scope of work. Typically, once a payment for services has been rendered, there is no refund; yet we refunded all the monies immediately.

      Lastly, even with your bank, they cannot immediately credit money into an account. Even if they indicate they do, it is merely a facial posting, which has to be verified with a merchant, and can always be revoked. Similar hereto any payment that may have accidentally been taken, must take a small portion of time to process through our accounting and your bank’s.

      • Sandra

        Legal Department stated that it refunded monies in a timely manner which is totally untrue. The delay was not with the bank, it was because after weeks of unanswered emails, phone messages, that a check was placed in the postal mail. Additionally the person whom I spoke with on the phone was made aware of my financial situation before any agreement was reached. He then acted without permission and laughed saying that what was said on the phone is not enforcable. He never gave the name of the ‘attorney’. Provident Law Group was trying to bypass the advance fee that is prohibited by the State of California by involving an escrow company to do their dirty work. Because of their actions, I am further behind in both time and resources.

      • Legal Department

        The real issue here Sandra is the fact that you are not a client of Provident Law Group. Further, you, the borrower, were not making your mortgage payments before you sought loan modification assistance. I assume that you had some sort of financial hardship, whatever it may have been, you did not pay your mortgage. You were originally in breach of your mortgage note and deed of trust, and the mortgage servicer and investor have a right to foreclose on you. A loan modification is not a matter of right, even if you have a Fannie Mae/Freddie Mac backed loan; not even those individuals are guaranteed a permanent modification.

        The real question is what did you do with your original mortgae payments? Did you spend this money on other things, hopefully, living expenses? Meaning you did not have the requisite amount of money to bring your loan current, and you got yourself into this bad financial situation. It is much easier to blame the company, than to recognize that you got yourself into this financial position long before you requested any assistance.

        Furthermore, verbal/oral agreements are not enforceable in court; this is standard contract law. Herein, I would refer you back to the original retainer agreement, in the additional recitals section it states the following:

        “ENTIRE AGREEMENT: This AGREEMENT contains the entire AGREEMENT of the parties. No other agreement, statement or promise made on or before the effective date of this AGREEMENT will be binding.”

      • lesly

        LEGAL DEPARTMENT , I WANT MY MONEY BACK . I BELIEVE IN GOD YOUR ARE GOING TO PAY FOR ALL YOU DID. YOU HAVE MY INFORMATION I WANT A REFUND OF MY $ 995.00 DOLLARS NOW. I WON’T STOP UNTIL YOU PAY FOR WHAT YOU DID,

    • bill

      what a bunch of miserable complainers get a life you want a law firm to work on saving your home and you could barely pay $500 that is what an attorney charges an hour if you cant pay that how are you going to make your mortgage payment and let me guess you meaning all of you complaining on this blog wanted that firm to work for you not for an hour or a day week but probably months for a thousand dollars a secretary makes more than that in 2 weeks and as far as the sb94 law it was put in place to prevent anyone out there to charge what ever they wanted for a loan modification and do nothing at all what is described on this blog seems to me like services rendered calling your lender doing your financials and charging for that seems like document prep work anyways this site is like all the other complaint blogs want it perfect and for free or as close as possible and can i get my money back hmmmmmmmmm.

      • http://GetOutOfDebt.org Steve Rhode

        Bill,

        Your statement about SB94 is perplexing. The bill was not passed to control fees. It was passed to prevent charging in advance for loan modification services.

        SB94 “prohibits any person, including a real estate licensee, who negotiates, attempts to negotiate, arranges, attempts to arrange, or otherwise offers to perform residential mortgage loan modifications or other forms of mortgage loan forbearance, as specified, for a fee or other compensation paid by a borrower, from demanding or receiving any preperformance compensation, as specified, requiring any security as collateral for final compensation, or taking a power of attorney from a borrower, and would make a violation of that prohibition a misdemeanor or subject to specified fines.”

        Can you point to a section of the law that supports your position. The law can be found here.

        Steve

    • Rustymwc

      Was this group Liberty and just changed their names?
       

  • Ms. Taylor

    Steve,
    I can see where a lot of people may very well appreciate your article, yet it actuality the majority or loan modification companies/law firms that are soliciting loan modifications are operated in the same format. The fees charged are not for a permanent modification, considering “a loan modification” is never guaranteed, and those words come from every lender out there. I have worked in this business for many years and fact is that people want to get paid for their services and there is a lot of phone calls and paper work to be done during the process of a modification, and anyone who says they work for free is lying. Most of the time what these companies offer is a better “know how” on getting the modifications approved. So I do not believe that what Provident Law is doing or Liberty Law is doing in regards to the ways are being charged is any different that any other company considering staff has to be paid one way or the other.

    • Legal Department

      We are very grateful to Ms. Taylor, who does have experience in the loan modification business for many years. She appears to fully understand the complexities that are involved in a typical loan modification file. Including that no two (2) loans are per se the same, even if they are in the same portfolio, and with the same investor. Please note, that a loan’s investor is typically silent, and may sometimes become known for the first time only with a Notice of Trustee’s Sale; if ever.

      Further in this regard, if you compare two (2) homeowners living right next door to each other, I am almost certain that when these two individuals applied for their purchase money mortgages, they did not have the same individual and/or household income, number of dependents, credit score, assets, etc., amongst other factors that go into the consideration of the loan. Moving forward they likely do not have the same servicing companies, payment history, loan type, impounds, etc., so compare any two loan modifications that may be received together. Loan modifications are extremely complex mechanisms, and there is more going on behind the scenes than homeowners give credit for, including politics and government influencing these matters.

      We would like to take the opportunity to remind everyone to re-read their contract’s “Disclaimer of Guarantee.” Clients who ultimately do not get approved for a loan modification by their mortgage servicer and/or investor then expect a refund, and demand our Company to give them one after countless hours of work.

      Nonetheless, this is unreasonable, because when you retain and thereby pay an attorney, you are paying for their representation of you to attempt to get you a modification, not necessarily to receive an actual loan modification. Legally, no company can sell a guarantee, as the ultimate decision resides with the servicer and investor, like a judge or jury; not the attorney representing you. If a client/consumer has a complaint they should file one with their mortgage servicer, including via a potential lawsuit against them; rather than bashing the attorney, who has worked diligently on a client’s file.

  • http://LibertyLawFirm Barbara

    Hi Steve… First of all thank you for all that you have done.

    I again can’t believe I was so stupid. I wrote Brian and like you have gotten no reply. Kinda didn’t expect one.

    I am filing complaints against him and the Law firm. Probably won’t do much good, but I’m doing it anyway.

    Amanda, be assured your not alone.. my loan company offered a “mod” that was $6 less than the orignial amount. Pretty good HUH !!!! I too will be in the same boat, cause I won’t accept it. I/we are no better off than when we started.I plan on sending another application in again, only this time it will be myself/ourselves only.

    Thanks again STEVE
    Barbara

    • Legal Department

      Barbara’s complaint is with Brian Colombana and Liberty Law Firm; not Provident Law Group and/or Jeffrey Cancilla. We would refer any readers hereto to the Colombana blog of April 18, 2010, located at: http://getoutofdebt.org/18442/liberty-law-firm-in-california-is-it-brian-colombana-esq-or-american-financial-modifications.

      Brian Colombana thereon told Barbara the following on June 6th, 2010 at 3:09 a.m., amongst other things, “Barbara, check your agreement. You never signed up with Liberty Law or paid Liberty Law any money. You are lying. Your complaint to the Oregon Attorney General’s Office against me has already been dismissed. What actually happened is you paid a company that went out of business. I offered to finish your modification at no charge. Liberty Law got you approved for a modification and all you can do is complain about only saving $6? [Emphasis Added]

      • http://GetOutOfDebt.org Steve Rhode

        Can you please help me to understand why your posts are from the same address as Joseph A and David? Who exactly are you and why did you publish a comment from Joseph A that appears to be from a client when you are now posting as an attorney with Provident.

        It seems odd.

        Steve

      • Sandy

        Love it! Call them on their lameness :) Ha ha ha

      • Mortgage King

        Get a Life Sandy

      • TDUONG

        WHORE

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