Orange County

SB 94 and AB 764: The End of Loan Modifications in California

by julie on October 1, 2009

Both the Senate and House in California have passed SB 94 and AB 764,  designed to stop the mortgage modification process in California.  It would prohibit loan modification companies, including lawyers from collecting any up-front fees for homeowners that are delinquent on their mortgage, and most likely facing foreclosure.

Once the govenor signs the bill then the law would go into effect immediately.  This ultimately will shut down the private loan modification industry in California, forcing homeowners to either do loan modifications themselves or turn to government-run organizations that for the most part has been hugely unsuccessful in getting a loan modification through. 

We have spoken with various loan modification companies and most indicate they will just close their doors if they cannot collect up-front fees.  How can a company make payroll if there is no money coming in?  Typically loan modifications take 4-6 months to go through.

Would you want to go 4-6 months without a paycheck? 

Legislators are not in touch with reality if they think the prohibition of upfront fee collections is a solution to the problem.

We predict that the passing of this bill will create mahem in the foreclosure world – leading to higher forclosure rates in San Diego, and Orange County.

Stay tuned for the wild ride!

Loan Modification Scams – FTC Stepping In to Stop Loan Mod Scam Artists

by julie on September 17, 2009

With so many loan modification scams, particularly in San Diego and Orange County, and for that part the rest of the nation, the FTC is considering banning the collection of up-front fees to stop loan modification scam artists from stealing people’s money.  There are a lot of legitimate loan mod companies operating, but there are also many loan mod businesses that collect up front fees that are 100% legitmate and can get the job done.

Our philosophy is that we will not take on a client that will not qualify for a loan modification.  We have a strict pre-approval process that we go through before moving forward with any client. If we don’t think we can get your loan modification through, then we will not take you on as a client. Why waste your time and ours!  If we don’t think you can qualify for a loan modification, then we will steer you into another direction such as a forensic loan audit or a short sale.

Call us today if you need guidance on what to do: 1 (619) 631-4546.

See below for the complete article on stopping loan modification scams at the federal level.

FTC Considering Ban on Up Front Fees For Loan Modification: Stop the Scams

 FTC considering ban on upfront payments for loan help; FTC files charges against 2 firms in San Diego and Orange County

 By Alan Zibel, AP Real Estate Writer

On Thursday September 17, 2009, 12:02 pm EDT

 WASHINGTON (AP) — The head of the Federal Trade Commission said Thursday the agency is considering banning upfront payments to companies that advertise help for borrowers who are in trouble on their home loans.

 Government officials say scammers seeking to take advantage of borrowers in danger of default often charge upfront fees of $1,000 to $10,000 for help with loan modifications that rarely, if ever, pay off.

The FTC announced it filed civil charges against two companies, San Diego-based Nations Housing Modification Center and Infinity Group Services of Orange County, Calif.

 The government accused both companies of charging homeowners large fees for assistance in working with their lenders, but doing “little or nothing” to actually help borrowers.

 Leibowitz said the FTC was also considering restrictions on how mortgage rescue companies can advertise their services. Ads for loan modification companies frequently appear on late-night TV and on billboards in some parts of the country. Nations Housing, for example, mailed homeowners official-looking letters purporting to be from an address on Pennsylvania Avenue in the nation’s capital.

 They were designed to trick consumers into thinking that they were participating in a government program, regulators said.

 The government has filed charges against 22 companies operating such schemes and say the firms often have names or ads designed to make borrowers think they are using the Obama administration’s efforts to help modify or refinance millions of mortgages.

 Authorities emphasized that help is available for free from government-approved housing counselors.

 On Thursday, 12 state attorneys general met with U.S. Attorney General Eric Holder, Treasury Secretary Timothy Geithner and Housing and Urban Development Secretary Shaun Donovan to discuss their anti-fraud operations.

 ”A lot of these scams operate nationwide, from outside our borders,” said Connecticut Attorney General Richard Blumenthal.