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Some Foreclosure Rescuers Only Look Attractive

Avoid Foreclosure Fraud

There is one major business that is successful these days and that is the foreclosure business.  With all of the foreclosures going on this business is growing like rapid fire.  There are many people who are advantage of this as an opportunity to make some money.

Some of these people, called foreclosure consultants or foreclosure rescuers are doing their best to falsely take advantage of distressed homeowners. There are many foreclosure rescuers who are very professional and are trained to help others who are stuck in these foreclosure problems. If you are going behind in your house payments or going through a foreclosure problem then you should start thinking about meeting a foreclosure rescuer.

However, you need to know that there are many scam artist who profess to be professionals.

Foreclosure consultants are usually good in negotiating a workout program with your lender so they assist you by working out a short sale or loan modification with your lender. Many foreclosure consultants have very good experience with the foreclosure and are in the business to help people as well as make a profit.

There are many fraudulent foreclosure consultants who are looking to cheat someone.  All the crooked foreclosure consultants want is money and for that reason they try to fool people going through the foreclosure process. Now, this does not mean that every foreclosure consultant is dirty.

There are certain steps you can take to determine if a foreclosure consultant is legitimate.

The first thing that you should ask a foreclosure consultant is for his/her references.  Every honest foreclosure rescuer should be able to provide you with references.  If they can’t, then tell them to get lost. 

The best way to find a good foreclosure consultant is to call 3-5 real estate agent and ask them for recommendations.

Foreclosure scam, real estate scam Pt 2 of 2

Foreclosure scams prey on homeowners

foreclosure rescuers, foreclosure consultants, foreclosure fraud, foreclosure scams, avoid foreclosure

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Legislation targets foreclosure scam artists

AUSTIN — The rising number of home foreclosures in Texas is spawning opportunistic scam artists who falsely promise to help vulnerable homeowners in exchange for hefty fees, Texas Attorney General Greg Abbott said Wednesday in pledging a state crackdown against the schemes.

Abbott threw his support behind legislation toughening regulations on companies that present themselves as “foreclosure rescue consultants.”

State Sen. Craig Estes, R-Wichita Falls, said his bill is designed “to send a very clear signal that these actions by unscrupulous mortgage foreclosure consultants will not be tolerated.” The measure will be considered in the legislative session that convenes in mid-January.

Abbott also announced an enforcement agreement against Arizona-based Abell Mediation, accused of making false claims that it could protect homeowners from imminent foreclosure. Abbott’s office secured similar agreements against two other companies last year, Foreclosure Assistance Solutions of Florida and Southern Residential of Texas.

Ripe for fraud

Foreclosure scams are becoming a “growing problem in Texas,” Abbott said. “It’s growing because foreclosures are growing. I don’t see it abating anytime soon.”

Although Texas has avoided the precipitous housing downturn facing other states, the economic slump has generated a growing number of foreclosures in the Lone Star State. In the Fort Worth area as of mid-November, foreclosures were up by about 18 percent for 2008 compared with last year.

Dallas-Fort Worth is ripe for foreclosure fraud because “there are so many homes and homes being foreclosed upon,” Abbott said.

Enforcement agreements

After combing official records to locate homeowners who are in danger of losing their residences, foreclosure consultants contact the owners and charge fees of at least $1,200 to negotiate with the mortgage company and offer other assistance. Unscrupulous operators, Abbott said, collect the money but take no action, leaving the homeowners to default on their mortgage with a ruined credit record.

Under the November enforcement action against Abell Mediation, the company and its president and vice president — Elizabeth Cory and Michael Cory respectively — were ordered to pay a total of $1.5 million in fines, restitution and attorney fees. The company is also prevented from conducting a “foreclosure mitigation” business.

But Dallas attorney Patricia Nolan, who represented the defendants, said the agreement was not an admission of guilt.

“The defendants have denied engaging in any wrongdoing or in any violation of Texas law,” she said. “When faced with the prospect of defending against the great state of Texas, they elected to settle.”

The company solicited customers on its Web site, Abbott’s office said, saying it had saved more than 7,000 homes from foreclosure. It also touted relationships with banks and mortgage lenders nationwide, the state said.

In the cases against Southern Residential and Foreclosure Assistance Solutions, customers signed contracts agreeing not to contact their lenders, the state alleged. Customers of Foreclosure Assistance paid fees of at least $1,200 but “rarely heard from the company’s representatives again,” the state said in a news release describing the case.

Southern Residential charged its customers up to $2,000. Additionally, some customers said the company’s “renegotiations” with lenders required immediate balloon payments totaling tens of thousands of dollars, the attorney general’s office said. Southern Residential received between $100,000 and $150,000 a month in fees, but many of the homeowners nevertheless lost their homes to foreclosure or went into bankruptcy, the state alleged.

The bill

Estes’ proposed Foreclosure Rescue Fraud Prevention Act would require foreclosure prevention consultants to provide customers with a written contract outlining the proposed services. It would also require a written disclosure statement advising customers to contact an attorney or housing counselor before signing mortgage rescue agreements.

Prosecutors could also obtain civil penalties under the state’s deceptive trade practices act.

By DAVE MONTGOMERY
dmontgomery@star-telegram.com

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Ways to Stop Foreclosure

There are actually quite a few ways that a homeowner can stop (or delay) foreclosure.  Here is a list with a brief explanation for each option.

Loan Workout
Loan Modification
Forbearance
Short Sale
Foreclosure Bail Out Loan
Deed-in-lieu of Foreclosure
Chapter 13 Bankruptcy

Read More…

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We’ve been hearing a lot about forensic loan audits and National Loan Audits (www. National Loan Audits . com).  We ran across more on the topic in the article that follows and thought it could be useful for homeowner’s with bad loans, or foreclosure subjects to use audits as a way to negotiate workouts with their lenders.

As always, you may want to discuss the process with an attorney, especially before you take the last paragraph to heart…

stop_foreclosure-fraud

“California is looking at establishing a three-month foreclosure moratorium, Massachusetts is suing servicers and Maryland is working directly with servicers to improve the mitigation process. One firm is scouring loan documents to find compliance errors for delinquent borrowers. But first, Visionet recently announced the revival of a refinance service in response to HUD’s Hope for Homeowners bailout plan for the mortgage industry. VisiRetention, which can be up-and-running within four to six weeks, proactively targets troubled
borrowers who qualify for the H4H program.

Residential Capital LLC — which is on the verge of collapse — issued a statement yesterday endorsing the streamlined modification plan announced by the Federal Housing Finance Agency, which regulates Fannie Mae and Freddie Mac. ResCap said its own loss mitigation efforts have helped prevent 251,000 foreclosures so far this year.

Treasury Secretary Henry M. Paulson Jr. today commended the chairman of the Federal Deposit Insurance Corporation for her streamlined modification strategy at failed IndyMac Federal Bank FSB. “FDIC Chairman Bair has given us a model, in the mortgage modification protocol she developed with IndyMac Bank,” Paulson said in a statement today. “Through the end of October, the FDIC has completed loan modifications for 3,500 borrowers, with several thousand more modifications currently being processed. These modifications have reduced payments for participating homeowners by an average of $380 month, or about 23 percent.”

California Governor Arnold Schwarzenegger has proposed a 90-day hiatus on some foreclosure proceedings, a notice from the state said.

Ocwen Financial Corp. announced last week that it prevented 22,257 foreclosures during the third quarter as a result of its track record on loan workouts. From January through September, 54,868 foreclosures were prevented.

Ocwen said Monday that it has agreed with Maryland’s Governor Martin O’Malley to establish a streamlined, timely and meaningful loss mitigation process for Maryland borrowers. The effort includes the designation of a Maryland team inside Ocwen, quicker communication with delinquent borrowers and a promise to accept initial
modification payments from a state program.

In a separate announcement, Maryland’s governor said similar agreements had been reach with AmeriNational Community Services, GMAC ResCap, HSBC, Litton Loan Servicing and Citi. Together with Ocwen, the six servicers handle 23 percent of mortgages in the state.

A preliminary injunction against Option One Mortgage Corp. and H&R Block Mortgage Corp. was granted to Massachusetts Attorney General Martha Coakley by the Suffolk Superior Court, a press release today said. Option One, now operated as part of American Home Mortgage Servicing Inc., is prohibited from initiating or advancing foreclosures on any of the 9,700 loans in the state that are considered presumptively unfair.

The state originally filed its lawsuit against Option One in June because it allegedly placed borrowers in risky loans that it should have known would wind up in foreclosure. The company was also accused of charging several hundred dollars more in fees and points to black and Latino borrowers than similarly situated white borrowers.

Option One must notify the attorney general at least 30 days before foreclosing on an adjustable-rate mortgage with a teaser rate that is more than 2 percent below the fully indexed rate and a loan-to-value
that exceeds 96 percent. The attorney general has 45 days to object while it determines if the loans were unfair, in which case the parties have 15 days to resolve differences.

National Loan Audits announced last week that it will help delinquent borrowers find compliance mistakes by their lender in order to threaten servicers with lawsuits and extract a loan modification. The firm performs forensic loan audits for $495 each. Customers receive a 40-page report detailing compliance violations.

The auditing firm claims that it finds mistakes on more than 80 percent of files it audits. “The most common violation is the understatement of prepaid finance charges and in many instances a mere $35 error within the Truth in Lending disclosure statement could entitle the borrower to a refund of all finance charges,
closing costs and interest payments made since the inception of the loan,” National Loan said.

Commonwealth of Massachusetts v. H&R Block Inc.
No. 1:08-cv-11225 (D. Mass.)”

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