Debt Relief Industry

Hope Now Financial, Hope Now Modifications, Salvatore Puglia and Nicholas Puglia Agree to $5 Million Dollar Settlement With New Jersey Over Loan Modification Fraud

New jersey Attorney General Paula T. Dow announced today that a New Jersey loan modification company and its owners have agreed to a judgment of $5,051,253 to settle civil charges they defrauded homeowners who sought help in avoiding mortgage foreclosure.

In addition to civil penalties of $5 million, corporate defendants Hope Now Financial Services Corp. and Hope Now Modifications LLC, of Cherry Hill, along with individual defendants Salvatore A. Puglia Sr. and Nicholas F. Puglia Jr., principals in the business, have agreed to pay the State $51,253 in attorney fees and investigative costs.

The $5-million-plus settlement resolves allegations that the defendants charged up-front fees totaling several thousand dollars for loan modification services, then failed to take any action on consumers’ behalf. The defendants were also charged with misrepresenting an affiliation with Hope Now Alliance, a legitimate non-profit alliance of mortgage companies, mortgage counselors, investors and other mortgage market participants that was formed in October 2007 as part of a federal foreclosure prevention initiative. Under the agreement, the defendants are permanently barred from selling debt adjustment or loan modification services in New Jersey.

“This is an important outcome, one that should send a message to anyone who might seek to exploit the financial desperation of others during these very difficult economic times,” said Attorney General Dow. “This company, and these individuals, callously peddled false hope to trusting people – people who needed real loan modification help. It is appropriate that they never again be allowed to sell loan modification or debt adjuster services in New Jersey.”

”These defendants preyed upon extremely vulnerable consumers — people who were facing the imminent foreclosure of their homes,” said Deputy Attorney General Lorraine K. Rak, Chief of the Division of Law’s Consumer Fraud Prosecution Section. “This settlement not only addresses the defendants’ deceptive practices, but also serves as a reminder that consumers seeking loan modification help should deal with licensed debt adjusters or other persons authorized to provide such services.”

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“Today’s announcement signifies New Jersey’s continued attack on mortgage fraud,” said Department of Banking and Insurance Commissioner Tom Considine. “We will not tolerate conduct of this type. Those who exploit struggling homeowners’ hopes and fears will face the law’s full measure.”

Filed in Superior Court in Camden County, the State’s six-count complaint charged Hope Now Financial and the other defendants with violation of the Consumer Fraud Act, violation of Advertising Regulations and violation of the Debt Adjustment and Credit Counseling Act for, among other things, engaging in unlicensed debt adjustment activity, and making misrepresentations and false promises to consumers.

The lawsuit accused Hope Now Financial and the other defendants of charging already-distressed consumers thousands of dollars in upfront fees for loan modification services, but failing to provide any such services.

Ultimately, the lawsuit charged, consumers fell further behind on their mortgage payments, making the threat of foreclosure more likely. The lawsuit also alleged that Hope Now Financial failed to provide refunds to consumers who received none of the agreed-upon loan modification services.

The complaint also charged that Hope Now Financial and the other defendants placed content on a Web site designed to deceive consumers into believing the company was affiliated with the non-profit Hope Now Alliance, which provides credit counseling and free foreclosure prevention.

Among the defendants’ victims were a husband and wife from Eagleswood Township, Ocean County, who had more than $2,800 billed to their credit card by the defendants, received no loan modification services, and ultimately confronted foreclosure after they stopped paying their mortgage on the advice of a company representative. Another victim, who resides in Kennesaw, GA, paid more than $3,500 to Hope Now Financial and received no assistance. After receiving a foreclosure letter, the victim renegotiated his mortgage in direct contact with his lender, but without defendants’ promised assistance. In total, 514 consumers have filed complaints against the defendants.

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Under terms of the settlement, $1 million of the $5 million judgment against the defendants is suspended for a five-year period and will ultimately be vacated, assuming the defendants comply with all restraints and conditions contained in the Final Consent Judgment.

The defendants have represented that Hope Now Financial Services Corp. and Hope Now Modifications are no longer operating, and that the Hope Now Modifications Web site is permanently disabled and inactive.

Under the settlement, the names of consumers victimized by the defendants will be sent to the Federal Trade Commission (FTC) and the FTC will, to the extent available, provide restitution.

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About the author

Steve Rhode

Steve Rhode is the Get Out of Debt Guy and has been helping good people with bad debt problems since 1994. You can learn more about Steve, here.


  • This guy is back at the Mortgage Modification game again. He is charging $2995 up front and 1/2 – 1 year later, people do not obtain a modification. Banned from Modifications for life? YEAH RIGHT. a few years later, one town over and he is back at it again. He has brought in another criminal to handle the document prep end of business. It ought to be a crime… crime apparently does pay.

  • This guy Sal Puglia has now been operationg a debt settlement companys for the last 2 year who just recently changed their name from 1st american debt solutions to legal settlement solutions. 5000 atrium way ste 5, mt laurel nj 08054. Please be careful and just avoid them, they will only make a bad situation worse.

  • This guy Sal Puglia has now been operationg a debt settlement companys for the last 2 year who just recently changed their name from 1st american debt solutions to legal settlement solutions. 5000 atrium way ste 5, mt laurel nj 08054. Please be careful and just avoid them, they will only make a bad situation worse.


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