How to Get Out of Debt With the Get Out of Debt Guy » mortgage modifications

I Need The Name of a Credible Loan Modification Company. – Charlotte

Steve Rhode — Wed, 15 Sep 2010 20:28:38 +0000

Charlotte

“Dear Steve,

I want to know how to find a credible loan modification company. Is there a list of fraudulent companies as to the consumer will know who not to do business with? I am having the hardest time trying to find anything on the internet which will inform me of fraudulent companies.

I have a sell date on my home for the end of September and I am running out of time. Please help Thank you

Charlotte”

The Answer:

Dear Charlotte,

Your best bet is to contact a free HUD mortgage counselor to discuss your options. I’m afraid most of the loan modification companies charging fees are make sales but not making a difference. Read the following stories on loan modification companies.

Big Hug!

@GetOutOfDebtGuy

Trail Loan Modifications Trash Credit Report and Credit Score

Steve Rhode — Mon, 24 May 2010 15:01:00 +0000

From How to Get Out of Debt

Carolyn Said of the San Francisco Chronicle wrote an excellent article “Loan modifications often damage credit scores” that covers the reality of the damage that occurs to credit from a loan modification.

Here are some excerpts. You should read the full article for more information

“Struggling homeowners who get a loan modification to reduce their mortgage payments are often unaware that it can seriously ding their credit score. Moreover, if they don’t get long-term help, the temporary loan mod can bury them in a deeper hole of debt that increases the likelihood they’ll lose their home.

Then, after 10 months, they got a letter from Chase saying they had been denied for permanent help and now owed $44,000 in past-due amounts and fees.

“A lot of people don’t understand that by making the payments due on their temporary loan mod they’re reported as delinquent immediately,” said Margot Saunders of the National Consumer Law Center in Washington. “It’s a huge misunderstanding.”

“A lot of lenders are reporting these modifications as paying under a partial payment plan. FICO regards that status as a serious delinquency,” said Craig Watts, a spokesman for FICO, which writes the software the credit bureaus use to determine scores. “There’s one saving grace if the lender reports the modification as being under the auspices of HAMP, but that does not mean the lender won’t also report the loan as being a partial payment plan.”

Watts said it is a “widespread myth” that short sales and deeds in lieu of foreclosure have less impact on credit scores than do foreclosures.

“Forcing people to be late is standard,” said Maeve Elise Brown, executive director of Housing & Economic Rights Advocates in Oakland. “I have never talked to a (struggling) homeowner who hasn’t been told by the servicer that they cannot do anything for them unless they go delinquent.”

@GetOutOfDebtGuy

Loan Modification Scams, “There should be a special place in hell for people who prey on people who are down to their last dollar”

Steve Rhode — Thu, 08 Apr 2010 13:56:34 +0000

From How to Get Out of Debt

The Providence Journal had a great article on mortgage loan modification scams. Here is an excerpt.

“Richard Godfrey, executive director of Rhode Island Housing, said that Rhode Island, which has been experiencing “800 foreclosures a month, virtually for two years, unabated,” has been fertile ground for loan-modification scam operators.

Typically, scam artists charge up-front fees, make promises that are too good to be true, then abscond with the money without ever lifting a finger to help distressed homeowners, speakers said.

“There should be a special place in hell for people who prey on people who are down to their last dollar,” Godfrey said.

“Bad guys aren’t always easy to spot,” said Federal Deposit Insurance Corporation director Thomas J. Curry.”

Read the rest of this article, click here.

@GetOutOfDebtGuy

FTC to Ban Upfront Fees for Foreclosure Rescue or Mortgage Modification

Steve Rhode — Sun, 14 Feb 2010 17:11:55 +0000

From How to Get Out of Debt

The Federal Trade Commission moved to protect distressed homeowners from the promoters of bogus foreclosure rescue and mortgage modification services by proposing a new rule that would forbid companies to charge up-front for these services. Instead, companies could only collect payment after providing services.

“Homeowners facing foreclosure or struggling to make mortgage payments shouldn’t have to contend with fraudulent ‘companies’ that don’t provide what they promise,” FTC Chairman Jon Leibowitz said. “The proposed rule would outlaw up-front fees so companies can’t take the money and run.”

According to the Notice of Proposed Rulemaking announced today, historic levels of consumer debt, increased unemployment, and an unprecedented downturn in the housing and mortgage markets have contributed to high rates of mortgage loan delinquency and foreclosure. This mortgage crisis has launched an industry of companies purporting, for a fee, to obtain mortgage loan modifications or other relief for consumers facing foreclosure. The FTC has brought 28 cases in this area, and state and federal law enforcement partners have brought hundreds more. Generally these cases charged that companies do not provide the services they promise and that they misrepresent their affiliation with the government and government housing assistance programs, including the Making Home Affordable Program.

The FTC notice seeks public input, particularly from attorneys and other professionals, on a proposed rule that would require mortgage relief companies to make good on their promised results before charging or accepting payment from consumers. Under the proposed rule, companies could not be paid until they had a documented offer from a mortgage lender or servicer that lives up to the promises they have made.

“Far too many homeowners have paid up-front fees to bad actors who promised loan modifications but never delivered,” Treasury Secretary Timothy Geithner said. “I commend the FTC for proposing a strong set of safeguards to protect consumers from these predatory practices.”

The proposed rule also would bar providers from telling consumers to stop communicating with their lenders or mortgage servicers, and from misleading them about key facts such as:

The likelihood of getting the results they want, and how long it will take.
Their affiliation with public or private entities.
Payment and other existing mortgage obligations.
Refund and cancellation policies.

In addition, the proposed rule would require providers to tell consumers that they are for-profit businesses, the total amount consumers will have to pay, that neither the government nor the consumer’s lender has approved their services, and that there is no guarantee that the lender will agree to change their loan.

The proposed rules would apply to for-profit companies that, in exchange for a fee, offer to work with lenders and servicers on behalf of consumers to modify the terms of mortgage loans or to take other steps to avoid foreclosure on those loans. The proposed rules generally exempt entities that own or service mortgage loans. Attorneys would have a limited exemption from the proposed advance fee ban if they represent consumers in a bankruptcy or other legal proceeding.

- Source

@GetOutOfDebtGuy

Nine Companies in NJ Slammed for Offering Mortgage Loan Modification Help

Steve Rhode — Mon, 07 Dec 2009 14:36:00 +0000

From How to Get Out of Debt

The Division of Consumer Affairs has mailed notices of violation to nine New Jersey-based companies that allegedly offered loan modification services to consumers without being licensed.

The nine companies each were cited for violating the state’s Consumer Fraud Act for engaging in unconscionable commercial practices by allegedly offering to negotiate mortgage modifications without being licensed as a debt adjuster by the Department of Banking and Insurance.

“Homeowners looking for mortgage help instead are becoming victims of fraud, and risk ending up in a worse situation,” Attorney General Anne Milgram said. “We want these nine unlicensed debt-adjuster companies to reimburse consumers for fees paid and to comply with our laws.”

The Notices of Violation are the latest in an on-going series of actions taken by the Office of the Attorney General and the Division of Consumer Affairs to protect consumers in the current mortgage and home foreclosure crisis. To date, 11 civil lawsuits have been filed against 102 defendants who allegedly committed mortgage or foreclosure fraud against consumers.

The Division also filed suit against a Lakewood-based firm, United Credit Adjusters, and obtained a court judgment in July that permanently barred the company from performing credit counseling, credit repair or debt adjuster work in New Jersey.

The nine companies each sent a Notice of Violation on November 24 are:

Affordable Finance
Best Response Loan Modification, Best Response Loan Mod
Home Rescue Today, Financial Solutions Today
Legal Loan Modifications
Premier Services & Consultants
RJD Consulting, RJD Mortgage
United Global Services
Xtra-Financial

Each company has been assessed a $5,000 civil penalty, in addition to the noted restitution.

Each company has the option of not contesting the charges contained in the Notice of Violation and paying the civil penalty and restitution within 15 days. Each company also has the option of contesting the charges and requesting an administrative hearing before the Division.

Mortgage/Financial Fraud Unit staff in the Division’s Office of Consumer Protection conducted the investigations of these companies.

@GetOutOfDebtGuy

How to Get Out of Debt With the Get Out of Debt Guy » mortgage modifications

I Need The Name of a Credible Loan Modification Company. – Charlotte

The Answer:

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