California Real Estate Fraud Report

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11
Sep

How to Stop Loan Modification Fraud – NOW

On September 10, 2009, California Attorney General Edmund G. Brown met local residents and community activists at a town hall meeting organized by Los Angeles City Councilman Alarcon at Mission College in Sylmar. The purpose of the meeting was to discuss loan modification fraud by con artists – including some attorneys – as well as the general unwillingness of banks that have received bail-out money from the federal government to modify the terms of distressed borrowers’ loans.

There has been no shortage of news regarding Attorney General Brown’s efforts to stamp out loan modification fraud by prosecuting those who prey on homeowners in default. This author has published a number of articles in both Examiner.com and the North Valley Community News advising borrowers to use extreme caution when dealing with loan modification consultants, and if they do, the questions that should be asked of these persons. Number One, though, is not to pay these individuals and firms any upfront money unless the firm is run by a licensed real estate broker or an attorney who has filed a plan of their business practices with the state of California Department of Real Estate (DRE).

Despite this, I get several emails and phone calls each week from homeowners who, through a combination of ignorance and desperation, caved in to the siren calls of loan modification firms.

Because the public still has not gotten the message about loan modification fraud, during the town hall meeting with Attorney General Brown, I got up and asked him to do the following to stop the fraud NOW:

When the County Recorder sends out a Notice of Default (NOD) to a homeowner who has defaulted on his or her mortgage, attached or enclosed with the NOD should be a letter with official letterhead from the Office of the California State Attorney General warning homeowners about loan modification scams. The cost to the state is minimal in terms of outlay, but over time, it will reduce the number of cases the Attorney General has to file against loan modification firms and attorneys which may be breaking the law with respect to modifying the loans of homeowners who cannot pay their mortgages.

If YOU want to stop loan modification fraud, please call or write your state senators and assembly members and ask them to lobby the Attorney General’s office to place educational information in the Notice of Default mailings from the County Recorder. You will be helping your neighbors, your community and perhaps even yourself.

This article is also published on Examiner.com by the L.A. Fraud Examiner.

© Copyright 2007-2017 Monique Bryher

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The information and notices contained on The California Real Estate Fraud Report are intended to summarize recent developments in real estate fraud, mortgage fraud, short sale fraud, REO fraud, appraisal fraud, loan modification scams, loan modification fraud and other real estate related crimes occurring in Los Angeles and California. The posts on this site are presented as general research and information and are expressly not intended, and should not be regarded, as legal advice. Much of the information on this site concerns allegations made in civil lawsuits and in criminal indictments. All persons are presumed innocent until convicted of a crime. Readers who have particular questions about real estate fraud, mortgage fraud and appraisal fraud matters or who believe they require legal counsel should seek the advice of an attorney.

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