Loan Deals: News

San Bernardino, California - Attorney General Edmund G. Brown Jr. announced that three individuals have pled guilty to loan modification fraud against hundreds of “desperate California homeowners” and were sentenced to as much as 6 years of prison.

“While doing nothing to help and pocketing all the money, these individuals ripped off desperate California homeowners who paid thousands of dollars to stop the foreclosure of their homes,” Attorney General Brown said.

The defendants sentenced were part of a foreclosure scam engineered by the First Gov company, which was based in San Bernardino, California.

* Rosa Conrado, 51, of San Bernardino, was sentenced today to six years, four months of prison for 6 counts of grand theft.

* Alejandrina Maldonado, 33, of St. Lucie, Florida, was sentenced on February 26, 2009, to a three year prison term for one count of grand theft.

* Martin Jesus Flores, 33, of Baldwin Park, was given three years of probation today based on his limited participation in the scheme.

* David Giron, 44, of Ontario, and Saul Amador, 23, of West Covina are scheduled for a preliminary hearing on March 19, 2009, for theft, money laundering, and conspiracy.

* Three other members of the ring - Juan Jose Perez, 48, of Grand Terrace, Isuara Hernandez, 33, of La Habra, and Antonia Gonzalez, 66, of San Bernardino - are believed to have fled the jurisdiction and may be out of the country.

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Mortgage

Don’t Make These Do It Yourself Loan Modification Mistakes

A loan modification can really help if you are a suffering a financial hardship and having a hard time meeting your monthly mortgage payments.  You can successfully negotiate a loan modification yourself by dealing directly with your lender, but you do need to have the proper knowledge and present a compelling case for yourself.  Here are 7 do it yourself loan modification mistakes that you need to avoid in order to be successful at getting your loan modification approved.

Mistake #1 Contacting your lender about a loan modification without understanding how the process works or what your lender’s requirements are.

You need to become familiar with the loan modification process itself and also what your lender’s requirements are before you ever contact them.  Do some upfront research on loan modifications and also see if you can find any particulars about your lender’s criteria before contacting them.

Mistake #2 Hiring an expensive loan modification service

You can do a loan modification yourself so there is no need to pay huge fees to a loan modification company.  If you do decide to hire a service, make sure you thoroughly research a loan modification company’s background and credentials before paying any fees.

Mistake #3 Talking to your lender’s collection department

If the collections department contacts you, they are not the ones that can help you with a loan modification.  You need to speak with your lender’s loss mitigation department.  They are the ones that handle loan modifications.  The collections department simply wants to collect on a debt. They are not equipped to help you with a loan modification.

Mistake #4 Not writing an effective hardship letter

Your hardship letter needs to be concise and compelling.  It needs to describe your financial hardship and convince your lender that the reason you are behind on your mortgage payments are because the payments are too high given your financial situation.

Mistake #5 Preparing loan modification applications that contain errors or omit information

It is imperative that you submit an accurate and thorough loan modification application that contains all the information your lender has requested.  Mistakes can delay and even cause your application to be rejected.

Mistake #6 Requesting an unrealistic loan modification

If you propose a loan modification that doesn’t meet the criteria of your lender your request for a loan modification will most likely be rejected.

Mistake #7 Not submitting a complete loan modification application

If you are missing forms or proof of income requested by your lender your application could be rejected.  With so many requests for loan modifications these days, you need to be sure you submit an accurate and complete loan modification application.

Do it yourself loan modification is possible.  Do your upfront research, propose a realistic loan modification request that is in line with your lender’s criteria, and submit an accurate, complete, and compelling loan modification application.

Mortgage

Good question. Many people try to avoid the costs of hiring a loan modification company; however, when they try to do their own modification they find themselves in uncharted territory of the mortgage and financial world. Attempting a loan modification without any knowledge of the process and lender requirements is risky and will likely result in a failed attempt. Once you have been denied a loan modification there is at least a ninety day waiting period before you can apply again.

There are a number of sources where you can access information about doing your own loan modification, such as the Department of Housing and Urban Development, on the web or using a loan modification manual. Your Basic Guide to Do-it-Yourself Loan Modification is a very useful tool to have when preparing your own loan modification package. This manual outlines the general format for which a loan modification should be presented. It is important to gather information on the loan modification process of your specific lender because each company has slightly different policies. After you have obtained this information start to get your documents in order.

Your Basic Guide to Do-it-Yourself Loan Modification provides you with a laundry list of all the documents that will be required by the lender. In addition, you must be able to demonstrate that you have experienced either and economic hardship, personal hardship or both.  This manual guides you through the process. Remember to be patient and calm when speaking with loan modification customer service representatives they ultimately hold the fate of your home in their hands.

Mortgage

With the growing number of foreclosures across the country, experts are warning homeowners about the dangers of loan modification companies.

They work by charging you a fee, and trying to talk your mortgage holder into dropping your interest rates or monthly payments.

Irene King, 66, knows about the companies. You see, King is facing foreclosure.

She said that her mortgage problems began in June when a company named Mortgage Shield, which once operated out of Katy, told her that for $159, they could get her a better interest rate.

King said that the company took the money out of her account. She said that she was told to sit back, relax and not to pay any notes because Mortgage Shield would take care of everything.

King said she didn’t pay anything for the next seven months.

She said that Mortgage Shield did nothing during that time, so she filed a complaint with the Better Business Bureau.

Now, she says with interest and penalties, she needs to come up with $20,000 to keep her home

And she doesn’t have it.

“I would say the majority of the companies who are doing loan modification aren’t doing them the right way, including the non profits,” said Kevin McGill who teaches loan modification seminars.

He said that if it is done right, it can help, but you still need to be cautious.

Mortgage Shield is no longer in business.

Meanwhile, Irene King is wondering if her home will soon belong to the bank. 

“I’m worried. I have five kids I’m taking care of and it would be pretty hard to start over,” she said.

Reports indicate that King is schedule for foreclosure in March. 

She said that she’s working with an attorney to broker a deal with the bank.

The Better Business Bureau said that Mortgage Shield has gone out of business and will not respond to their complaints.

Loan Modification

Better Business Bureau is warning people who have been solicited by unknown companies to help reduce their mortgage payment through a loan modification or by refinancing their mortgage to do their research first.

BBB has received numerous calls this year from consumers who are confused by the advertisements and offers they have received to lower their loan interest rates.

“A large portion of homeowners are being contacted by companies that offer too-good-to-be-true promises, like a guaranteed result in reducing a payment or modifying a loan,” said BBB President/CEO Matthew Fehling. “While there are reputable companies that can work with a mortgage lender, homeowners need to be aware of who they are doing business with so they do not fall victim to a scam company.”

A loan modification is a permanent change in one or more terms of a mortgagor’s loan. The modification can range from a direct change in interest rate to the amount owed on the loan; the loan stays with the same company. Refinancing a mortgage might include changing the loan servicing company and requires fees to be paid, including for a home appraisal.

Consumers looking to modify their mortgage loans or refinancing their mortgages should keep the following tips in mind before accepting any offers:

• Call BBB to check the company’s reliability report.

• Confirm any licensing claims of the company with the Arizona Department of Financial Institutions.

• Contact your current mortgage lender and inquire about options available to you. Modifying a loan is a process that homeowners can do for free, eliminating the need to hire a company to help you.

• In order to qualify for a loan modification or to start the process of refinancing, homeowners will need to submit financial documents to the mortgage lender that shows they have the ability to make the payments.

• Homeowners should never follow advice that tells them to “stop paying a monthly mortgage payment.” A reputable loan modification company will tell a homeowner to continue making payments as long as possible.

• Homeowners should not pay upfront for a loan modification. Similar to a loan refinancing application, any fees should be paid once the loan modification is approved and closed.

If you are being offered a loan modification service; feel you have been a victim of loan modification fraud or a refinance option that sounds too good to be true, contact your BBB and check out the company at arizonabbb.org or by calling 1-602-264-1721.

Loan Modification, Scams