Tuesday, December 27, 2011

Illinois AG Tags Three More Loan Modification Outfits With Civil Suits; Runs Total Number Of Legal Actions Against Suspected 'Rescue' Rackets To Fifty

In Chicago, Illinois, the Chicago Tribune reports:

  • The state attorney general's office filed suit Monday against three Chicago-area firms and their principals who allegedly operated mortgage rescue schemes that conned homeowners out of more than $44,000 in upfront fees and provided them with little or no help.

  • The cases share many similarities, including preying on consumers for whom English is a second language, collecting upfront fees and telling consumers to ignore any mail sent to them by their mortgage companies.

  • In Illinois, it is illegal to charge consumers upfront fees for loan modification services not yet provided. In at least one of the cases, a homeowner lost his home to foreclosure as a result of the purported fraud.

  • "People are desperate to save their home, and they're so intimidated by even the thought of trying to deal with their bank," said Illinois Atty. Gen. Lisa Madigan. "For many people, they got a mortgage through a broker and their only contact since then has been writing a check. The idea that they have to find someone to interface with, especially when they're not fluent, scares them. When someone says 'I can handle this, give me $500 and I can get you a modification,' they are relieved. People don't think they can do this on their own."

For more, see Madigan sues 3 local firms over mortgage modifications.

For the Illinois AG press release, see Madigan Files 50th Suit Against Mortgage 'Rescue' Scheme, Leads Nation In Crackdown On Scams Targeting Distressed Homeowners.

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