MORTGAGE FRAUD STILL RUNNING RAMPANT

MORTGAGE FRAUD STILL RUNNING RAMPANT

The Federal Trade Commission continues to monitor mortgage fraud scams. One of the newer iterations is what they call the “Mass Joiner Lawsuits.”

Naturally, the target is the struggling homeowner.  They lure their victims with promises of using legal tactics to forestall foreclosure, reduce mortgage balances, lowering the existing interest rates, or restoring borrower’s credit.

The perpetrators purport to be law firms, according to a consumer alert by the Federal Trade Commission’s web site.  Some have only one attorney on staff and others have none.

The firms charge up front fees ranging from a few thousand dollars to more then $ 10,000 and deliver nothing in return.  Reports reveal that unsuspecting homeowners have lost more then $ 60 million dollars to these scams in the last two years alone.

The firms claim that their tactic is to file class action suits on behalf of participating homeowners.  The fact is that in most class action lawsuits the participants pay nothing in advance.  The law firm works for a portion of the settlement they gain for those participants.

FTC rules allow only lawyers to collect upfront fees to provide mortgage aid services.  Obviously, they have a strong political lobby.

There are legitimate law firms providing mortgage aid services.  The FTC recommends that you get the names of the lawyers who will be representing you and check them with the state bar association.  Make sure that they have a license to practice in your state.

Watch out for those who make promises that sound too good to be true.  In all likelihood, they are just that.

Select this link to view the Federal Trade Commission web site release on this subject.

http://www.ftc.gov/bcp/edu/pubs/consumer/alerts/alt082.shtm

If you know someone who is having trouble with their mortgage and needs help, have them call (916) 337-0658. There is no charge.  We are here to help.