louie d asked:


I live in CA, will the bank go after me of my wife’s unpaid mortgage, I did a quit claim in our house, I am not in the mortgage loan, Will I face any legal recourse for putting quit claim? Can I buy another house, this time more affordable. Which way should we go, foreclosure or short sale? Pls give a sound advice….

Stacy

Brad P Newman asked:


gh mortgage loan modifications have helped so many people to save their homes during the current economic crisis, there is still a lack of knowledge amongst homeowners (many of whom may well be in dire need of this service) as to exactly what loan modification is, how it works, how to apply, who qualifies etc.

Let us start by dispelling a common myth about loan modification:

Loan Modification is appropriate only in the case of foreclosure.

It is a common misconception among homeowners that loan modification is an option only under extreme circumstances, such as when you are on the verge of foreclosure.

This is not so. Literally millions of people in America qualify for loan modification without being in foreclosure. Broadly, anybody whose monthly expenses exceed their monthly income may be a good candidate for loan modification. You can have money in the bank, you can have an expensive car parked on your drive and still qualify for loan modification. You just have to be moving backwards financially, so to speak: spending more each month (in essential outgoings) than you have coming in.

Families can get into financial difficulty for any of a number or reasons – loss of job, reduction in pay, sudden unexpected medical costs, a partner or spouse may lose their income.

Loan modification is a renegotiation of the existing mortgage, to effect a reduction in interest rates (and, sometimes, a reduction of loan principal too), leading to lower monthly payments which are affordable and sustainable to the homeowner.

It is a long-term solution – it can help you save your home permanently. It\’s no good if the new lower monthly payment is too high and you are straight back facing foreclosure six months down the line. For this reason, the loan modification in and of itself may not be enough – it may be necessary to demonstrate to the lender that you can lower your outgoings and/or increase your income such that the modified loan is a realistic solution.

While it is possible to contact your bank\’s loss mitigation department directly to initiate a loan modification request, it is not really advisable to go it alone. It makes as much sense as representing yourself in a court of law.

You really need the services of a good loan modification company, which has its own team of dedicated loan modification attorneys. They know how to speak to the banks to achieve the desired result. It is not uncommon for good loan modification companies to achieve a reduction in interest of 30 – 50% on behalf of their clients.

This is well worth whatever fee the company charges – it could mean no less than the difference between losing your home (with all the pain and upheaval that entails) and keeping it.

Janice

Loan Modification Help Center asked:


Federal Trade Commission (FTC) Chairman Jon Leibowitz was recently joined by California Attorney General Jerry Brown to announce the initiation of “Operation Loan Lies”, a coordinated national law enforcement effort to crack down on mortgage loan modification scams.

The operation has already filed 189 actions by 25 federal and state agencies against fraudulent loan shops that used deceptive marketing to push their shabby or non-existent foreclosure rescue and mortgage modification services. The actions involve homeowners across the country but were announced in Southern California, where the fraudulent companies were based. “These con artists see the high foreclosure rates as an opportunity to prey on people in distress,” FTC Chairman Jon Leibowitz said. “They promise to rescue homeowners in troubled financial waters, but after they take their money they throw them an anchor instead of a lifeline.”

In conjunction with the announcement the FTC gave details on four additional lawsuits which brings the total of mortgage foreclosure rescue and loan modification scam cases the Commission has brought since April to fourteen. In the four new lawsuits, defendants are charged with:

Making false claims that they would obtain a home loan modification Making claims that, in conjunction with the loan modification, they would stop foreclosure proceedings Failing to honor promises of refunds to homeowners if the proposed action was not successful

The defendants are charged with doing little or nothing to advance the loan modification process for their clients after receiving fees approximately equal to one month’s mortgage payment.

The specific charges against defendants are as follows:

U.S. Foreclosure Relief made false claims of fast turnarounds for approvals and years of experience with fictitious success rates for their loan modifications. Homeowners received neither. They are also charged with violating the FTC’s Do Not Call Rule due to their repeated contacts with homeowners on the National Do Not Call Registry. Pending a court date, assets of U.S. Foreclosure Relief were frozen. Lucas Law Center made false representations about their capability to obtain loan modifications. They also told homeowners to divert their mortgage payments toward paying Lucas’ fees, a violation of the law. The company did provide refunds to some of their clients but only after repeated complaints and requests for help from the Better Business Bureau, the California Attorney General, the State Bar of California, and/or local authorities. The court froze Lucas Law Center’s assets ahead of a court hearing Loss Mitigation Services assured homeowners that their loan modifications were virtually assured because they were a department of, or affiliated with, the consumer’s lender or mortgage servicer, a complete fabrication. Some homeowners lost their homes while waiting for modifications which would never happens. ·         Apply2Save made claims that they could get loan modifications done in thirty to ninety days when, in fact, they never made contact with the homeowners’ lenders. To stall for time, Apply2Save told their customers that paperwork was lost, often more than once.

Operation Loan Lies follows an April 6, 2009, announcement by FTC Chairman Leibowitz, Attorney General Eric Holder, Treasury Secretary Timothy Geithner, Housing and Urban Development Secretary Shaun Donovan, and Illinois Attorney General Lisa Madigan that there would be a crack-down on companies that were set up to defraud homeowners seeking home loan modifications.

The four companies provide valuable lessons in how homeowners can protect themselves from hiring a deceptive company that will not deliver on promises. In the case of U.S. Foreclosure Relief, one warning sign would any talk or intimation of affiliation with the U.S. government. U.S. Foreclosure Relief and Apply2Save both pitched themselves as being able to get approvals for home loan modifications faster than any of their competitors. Homeowners should be aware that the process of modification is two sided and that lenders are currently flooded with applications. Any promises of fast turnarounds should be met with great skepticism. Lucas Law Center advised customers to pay them instead of their lender, an obvious warning about their regard for legal and ethical standards. Finally, Loss Mitigation Services’ claims of affiliation with lenders and guarantees of loan modification approvals because of it were definite red flags. Finding the truth would have been as easy as making a direct call to the lender to verify the claims.



Avoiding the problems encountered by homeowners that were scammed by these firms is as simple as asking the right questions, doing some leg work, and realizing that if it sounds too good to be true, it probably is. Insist on working with a firm that has already done hundreds of loan modifications and can prove it. Visit the office and ask questions until you’re comfortable. A loan modification is a huge and important undertaking. Ensuring its chances of success by doing your homework will keep you out of trouble and give you a much better chance at staying in your home.



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