More Homeowner Complaints On Loan Modification Firms From Around The Country

The following links are to stories on financially strapped homeowners reporting problems with loan modification companies they hired to help resolve their mortgage problems:

• Port St. Lucie, Florida: Treasure Coast homeowners should be wary of mortgage modification scams. Mateo Avila was watching a Spanish language network when he saw a commercial for Miami-based Lincoln Lending Services, which claimed to specialize in loan modifications for homeowners. He called the toll-free number in January and did exactly what the company asked. "They told me, don't pay for the house," said Avila, who stopped paying his two home loans with Aurora Bank and Countrywide in October. "They (Lincoln Lending) took $3,000, two checks for $1,500 to do a modification." After handing over the money, Avila couldn't get any straight answers from Lincoln Lending. When his lenders foreclosed on the home last month, he soon realized he'd been scammed and contacted the Mortgage Fraud Task Force of Florida Attorney General Bill McCollum. [...] Gifford resident Elizabeth McGriff got a pamphlet in the mail from The Foreclosure Relief Group and called the company after her husband's work hours were cut. State records show the company is owned by Brian Nierenberg in Fort Lauderdale. McGriff said the company told her to pay $1,995 to start a loan modification and also asked her to pay them $550 a month until the loan was modified. Nierenberg claims his business is simply a lawyer referral service and collected fees go to attorneys.

• Orlando, Florida: Warning About Foreclosure Rescue Companies. Jackie Day is struggling to pay the mortgage on her Orlando condo so she wanted to lower her monthly mortgage payments. Jackie saw an ad for "The Home Savers," a California company that by phone told her it would cut her payments. But she says Home Savers wanted her to stop making mortgage payments to qualify. "What I would have to do---is not pay my mortgage for three months. I was to send $1,500 payments." A Home Savers spokesman said the upfront fee is an attorney's retainer and is a legal charge.

• Jacksonville, Florida: Southside Foreclosure Firm Accused of Scamming Homeowners. "I thought these folks had more knowledge and different avenues to approach our mortgage company," Royce Belle, a Jacksonville homeowner who enlisted the help of National Foreclosure Counseling Services, said. "They did not." Belle's story is one state investigators say is being told and re-told all over the country by homeowners contacted by NFCS. "We recieved a letter from National Foreclosure Services stating that they were able to help us lower our payments," he tells WOKV. "The said they'd charge us $2,044 to get our mortgage modified." Belle admits he took the bait; paying the fee and hoping to clear up rising mortgage payments and keep his home. But weeks turned into months, and Belle says he never heard from NFCS. Eventually, he says, NFCS presented a re-financing plan that actually raised his monthly mortgage payment a dollar. "We told them that doesn't make any sense," he said. "Nothing changed. We told them they didn't actually do anything for us." When Belle decided to cut ties with the company and demand a refund, he claims NFCS threatened to bankrupt him. He's now suing the company in small-claims court.

• Lake Ronkonkoma, New York: Mortgage modification mess. Back in January, homeowner Jim Gentile paid $3000 to Hope Now Modifications and a south Jersey law firm to get his mortgage modified. Jim says they told him, "We can get you a fixed rate for 5 years. (And reduce it) down to 5.25% (interest rate) which is great, cuts my mortgage in half." But Jim says all Hope Now Modifications did was tell him to stop paying his mortgage. He fell three months behind on his payments. Jim says his current mortgage company said it had never even heard of Hope Now Modifications. Jim says Hope Now Modifications led him to believe they were a non-profit agency.

• Omaha, Nebraska: Mortgage Middleman Almost Costs Couple Their Home (Attempt to refinance leads to foreclosure). An Omaha couple decided to pay a middleman to help them negotiate a better rate. What they got instead was a mortgage mess. When their variable house payment jumped, the hardworking Booker family didn't think the big mortgage company would listen to them so they paid a middleman, but the first piece of advice was ill-advised. After making five payments totaling $3,000 to First Universal of Florida, which was supposed to negotiate a fixed rate with their mortgage company, the Bookers instead received notice of default from an attorney. Their house was on the brink of foreclosure.

• Indianapolis, Indiana: State targets foreclosure consultants. Homeowners are hiring foreclosure consultants to prevent banks from seizing their homes, only to find themselves swindled. Vivienne Daniels paid $392 to a company called Capitol Foreclosure (for the Indiana AG's lawsuit, see State of Indiana v. Capitol Foreclosure). "I was behind. My mother died," she said. But according to Daniels, "they did nothing." Last year, the attorney general's office took four foreclosure consultants to court. The attorney general's office won judgments against three of the companies. A fourth is awaiting trial. Vivienne Daniels got an attorney, lost some money, but kept her home. "I was real lucky. I lost about $400. It would have been bad to lose your home," Daniels said.

• Long Island, New York: Housing advocates question loan modification firms. At a recent ACORN protest of AmeriMod loan modification company in Uniondale, homeowner Claudette Broderick said the firm got her only a forbearance from her lender. Usually under forbearance, the loan is taken off the delinquency rolls and the late payments are added on top of the regular monthly ones. Broderick, laid off as a nursing assistant, said she couldn’t afford the regular $3,100 monthly bill and the forbearance would have pushed the monthly bill to about $3,600.