Advertise Here

Deliver your message to thousands of readers every day.

Our readers are influential opinion makers - politicians, journalists and activists.

Learn more about ads.

Our latest headlines

Want more? Dive into the archives.

About Us

David Greenwald, Editor. (Contact David.)
CFC Education Foundation, Publisher. (Contact us.)

Got a news tip? Want to write a guest column?
Contact David here.

About California Progress Report.

Founded by Frank D. Russo (Publisher and Editor, 2006-08).

Books

Legislators Square Off with Lobbyists on Mortgage Modifications

By Jill Replogle
Special to the California Progress Report
Lobbyists working on banking and lending issues are especially busy at the Capitol these days.

As lawmakers debated a half-dozen contentious bills that could help shape future lending practices in California last week, lobbyists dashed back and forth between hearing rooms where the Assembly Judiciary Committee and Senate Banking, Finance and Insurance Committee met, speaking the minds of their clients on the record and in not-so-hushed whispers around the committee rooms

Consumer advocates faced off with Realtors, long one of the most powerful groups in Sacramento. Consumers seemed to have the upper hand last week. But the bills have many more stops before they reach the governor’s desk.

Among the more contentious bills were two that would make real estate agents and others who assist in modifying mortgage loans wait to get paid until after they’ve done the work. As more and more Californians face foreclosure on their homes, a booming industry has developed to help people change the terms of their mortgage loans.

While much of the industry is legitimate, legislators, consumer interest groups and the State Bar say scams are rampant. Representatives of the real estate and mortgage business agree, but say licensed agents who follow the rules should be allowed to charge upfront as usual.

“The bad guys are breaking the law now; they don’t need a new law to break,” said Stan Wieg, staff vice president of the California Assn. of Realtors, at the Senate Committee on Banking, Finance and Insurance hearing.

Under current law, real estate brokers can charge upfront fees for loan modifications if they first have their advance fee agreement approved by the Department of Real Estate. Lawyers also are allowed to charge upfront fees for these services.

Proponents of the bills say no one should be charging advance fees.

“It’s ridiculous that you actually need this industry at all,” said Paul Leonard from the Center for Responsible Lending, which supports the bills. “You shouldn’t need to have to pay someone to refinance a loan that should be in the mortgage servicers’ interest anyway.”

State regulators are fielding a growing influx of complaints from consumers who say they’ve been ripped off by scam artists posing as loan modification specialists. The California Department of Real Estate had about 800 investigations into potential scams pending in June, compared to fewer than 10 in June 2008, said Tom Pool, the Department’s public information officer.

In March, the State Bar issued an ethics alert to lawyers. The Bar had “been getting almost 1,000 calls or inquiries a month from consumers concerned about lawyer actions relating to loan modifications and foreclosure.” In February, the ethics commission of the State Bar urged lawyers to beware of ethically murky relationships with foreclosure consultants.

Atty. Gen. Jerry Brown recently filed suit against a Southern California lawyer who allegedly charged at least 2,000 consumers for mortgage modification services that were never carried out. The suit also names a corporation that allegedly sought out distressed homeowners and referred them to the lawyer.

Besides prohibiting upfront fees, the bill, AB 764 by Assemblyman Pedro Nava (D-Santa Barbara) and SB 94 by Sen. Ron Calderon (D-Los Angeles) would require real estate brokers, attorneys and any others in the loan modification business to give clients a written notice saying they could get the services elsewhere for free—from nonprofit housing counseling agencies or directly from the lender. Both bills have a sunset clause of Jan. 1, 2013.

At his bill’s hearing on Thursday, Nava said professionals who attempt to negotiate loan modifications for a fee are “no more likely than the homeowner to have success.”

Wieg of the Realtors, one of the most influential groups in Sacramento, says he’s heard the opposite.

The California Assn. of Realtors opposes the bills, saying advance fee contracts approved by the Department of Real Estate should be able to stand. In a letter opposing the bill, Wieg wrote that the system for licensed realtors ensures that “the consumer is dealing with a legitimate licensee that is willing to play by the rules, and has given notice to the regulator that he or she is engaging in this area of practice.”

Wieg said prohibiting real estate agents from charging advance fees could cause them to reject potential clients with difficult loan modification cases.

The Senate committee approved the measure by a 7-3 vote. It still must pass the Senate Judiciary Committee before making it to the floor. SB 94 passed the Assembly Judiciary Committee on an 8-2 vote and now moves on to Appropriations.

Jill Replogle has worked as a freelance journalist in the Bay Area and Central America for eight years. She is now a student at the UC Berkeley Graduate School of Journalism. Jill is currently an intern for Protect Consumer Justice, a project of the Consumer Attorneys of California.

Posted on July 13, 2009

Comments

I paid this company $3000.00 and have recieved no help. So have many others please help up
I reported to BBB friday

Posted by HARROLD on January 18, 2009 at 02:32:53:
In Reply to: Has anyone heard of U.S. Consumer Law Center posted by Barbara on January 17, 2009 at 20:43:49:
U.S. Consumer Law Center is a trade name. Has no affiliation with the government.

They are a private company that helps people in foreclosure for a fee.

Follow Ups:

loan mod rip off - lynda mcmorries 15:35:48 07/11/09 (0)
Re: Has anyone heard of U.S. Consumer Law Center - Barbara 11:50:08 01/18/09 (12)
Re: Has anyone heard of U.S. Consumer Law Center - JR in California 09:45:45 01/19/09 (2)
Re: Has anyone heard of U.S. Consumer Law Center - Great center 11:09:49 07/09/09 (0)
Re: Has anyone heard of U.S. Consumer Law Center - K in California 16:24:50 02/04/09 (0)
Re: Has anyone heard of U.S. Consumer Law Center - fp 13:13:42 01/18/09 (8)
Re: Has anyone heard of U.S. Consumer Law Center - Jamie 11:42:35 01/23/09 (6)
Re: Has anyone heard of U.S. Consumer Law Center - Ethel 15:59:58 07/06/09 (3)
Re: Has anyone heard of U.S. Consumer Law Center - javier 19:32:47 07/08/09 (2)
Re: Has anyone heard of U.S. Consumer Law Center - MM 01:22:49 07/09/09 (1)
Re: Has anyone heard of U.S. Consumer Law Center - Bronx 13:50:54 07/09/09 (0)
Re: Has anyone heard of U.S. Consumer Law Center - fp 13:17:16 01/24/09 (0)
Re: Has anyone heard of U.S. Consumer Law Center - steele in minnesota 09:36:59 01/24/09 (0)
NO soliciting - steele in minnesota 14:03:17 01/20/09 (0)
Thank you for filing your complaint. As you requested, below is a copy of your complaint.

Within the next business day, you will receive an email acknowledging receipt of the complaint. That acknowledgment will also give you information on how you can track the status of your complaint through our website.

Complainant Information

Mr. Lynda mcmorries
1241 w 23 rd st
san pedro, CA 90731 USA
lyndamcmorries@yahoo.com
Phone: (310) -95-1-0582
Fax:

Company Information:

US Consumer Law Center
18011 Sky Park Circle
Irvine, CA 92614
Website:
Phone: (800) 383-7956

Complaint Text

moved location no website called for 3 weeks no return calls I think I have been scamed

Resolution Sought: get me help with my modification.
Lynda McMorries

Yolanda D Romero

1241 W 23rd St

San Pedro, Ca 90731

310-951-0582

To: Indy Mac

Re: Mortgage modification program

My fear is that my adjustable rate mortgage will cause me to loose my home this is always on my mind. I currently have had this mortgage for about 4 years; I am finding it very difficult to afford and when the payment adjust this will be a real hardship for my daughter and myself.
Date Problem Started: 1/30/2009
Date of Transaction: 01/30/2009
Amount in Dispute: $0.00
Invoice Number: modifcation
Complaint Type: Ad Practices
Product or Service: modification paid $3000.00 in march 2009

If you have any questions regarding your complaint, please contact the Complaint Dept. at (909) 825-7280 or email info@labbb.org.

Complaint Department

BBB of the Southland, Inc.

Posted by: LYNDA at July 13, 2009 07:10 AM

I paid this company $3000.00 and have recieved no help. So have many others please help up
I reported to BBB friday

They are a private company that helps people in foreclosure for a fee.

Follow Ups:

Complainant Information

Mr. Lynda mcmorries
1241 w 23 rd st
san pedro, CA 90731 USA
lyndamcmorries@yahoo.com
Phone: (310) -95-1-0582
Fax:

Company Information:

US Consumer Law Center
18011 Sky Park Circle
Irvine, CA 92614
Website:
Phone: (800) 383-7956

Complaint Text

moved location no website called for 3 weeks no return calls I think I have been scamed

Resolution Sought: get me help with my modification.
Lynda McMorries

Yolanda D Romero

1241 W 23rd St

San Pedro, Ca 90731

310-951-0582

To: Indy Mac

Re: Mortgage modification program

If you have any questions regarding your complaint, please contact the Complaint Dept. at (909) 825-7280 or email info@labbb.org.

Complaint Department

BBB of the Southland, Inc.

Posted by: LYNDA at July 13, 2009 07:12 AM

I paid this company $3000.00 and have recieved no help. So have many others please help up
I reported to BBB friday

They are a private company that helps people in foreclosure for a fee.

Follow Ups:

Complainant Information

Mr. Lynda mcmorries
1241 w 23 rd st
san pedro, CA 90731 USA
lyndamcmorries@yahoo.com
Phone: (310) -95-1-0582
Fax:

Company Information:

US Consumer Law Center
18011 Sky Park Circle
Irvine, CA 92614
Website:
Phone: (800) 383-7956

Complaint Text

moved location no website called for 3 weeks no return calls I think I have been scamed

Resolution Sought: get me help with my modification.
Lynda McMorries

Yolanda D Romero

1241 W 23rd St

San Pedro, Ca 90731

310-951-0582

To: Indy Mac

Re: Mortgage modification program

If you have any questions regarding your complaint, please contact the Complaint Dept. at (909) 825-7280 or email info@labbb.org.

Complaint Department

BBB of the Southland, Inc.

Posted by: LYNDA at July 13, 2009 07:12 AM

I paid this company $3000.00 and have recieved no help. So have many others please help up
I reported to BBB friday

They are a private company that helps people in foreclosure for a fee.

Follow Ups:

Complainant Information

Mr. Lynda mcmorries
1241 w 23 rd st
san pedro, CA 90731 USA
lyndamcmorries@yahoo.com
Phone: (310) -95-1-0582
Fax:

Company Information:

US Consumer Law Center
18011 Sky Park Circle
Irvine, CA 92614
Website:
Phone: (800) 383-7956

Complaint Text

moved location no website called for 3 weeks no return calls I think I have been scamed

Resolution Sought: get me help with my modification.
Lynda McMorries

Yolanda D Romero

1241 W 23rd St

San Pedro, Ca 90731

310-951-0582

To: Indy Mac

Re: Mortgage modification program

If you have any questions regarding your complaint, please contact the Complaint Dept. at (909) 825-7280 or email info@labbb.org.

Complaint Department

BBB of the Southland, Inc.

Posted by: LYNDA at July 13, 2009 07:13 AM

I paid this company $3000.00 and have recieved no help. So have many others please help up
I reported to BBB friday

They are a private company that helps people in foreclosure for a fee.

Follow Ups:

Complainant Information

Mr. Lynda mcmorries
1241 w 23 rd st
san pedro, CA 90731 USA
lyndamcmorries@yahoo.com
Phone: (310) -95-1-0582
Fax:

Company Information:

US Consumer Law Center
18011 Sky Park Circle
Irvine, CA 92614
Website:
Phone: (800) 383-7956

Complaint Text

moved location no website called for 3 weeks no return calls I think I have been scamed

Resolution Sought: get me help with my modification.
Lynda McMorries

Yolanda D Romero

1241 W 23rd St

San Pedro, Ca 90731

310-951-0582

To: Indy Mac

Re: Mortgage modification program

If you have any questions regarding your complaint, please contact the Complaint Dept. at (909) 825-7280 or email info@labbb.org.

Complaint Department

BBB of the Southland, Inc.

Posted by: LYNDA at July 13, 2009 07:13 AM

please tell everyone this company is a scam

From: Mike Rafael
Subject: Items needed for modification process
To: "lyndamcmorries@yahoo.com"
Date: Monday, March 30, 2009, 12:09 PM

Good Morning Linda,

The following is a list of items needed from you to begin the modification process:

Detailed Hardship Letter
Monthly Financial Statement –total of all bills on a monthly basis-mortgages included
Notarized power of Attorney Form-use the one you have-just have it notarized
Updated paystubs (2)
2 years Tax Returns-W’2s & completed 4506-T form (enclosed)
2 months current/complete bank statements
Mortgage coupon for 2nd Mortgage (HSBC)

These are the items that are necessary to initiate the modification process. If you receive any documentation from any of your lenders, please be sure to forward it to me. If you are contacted via telephone, take a name and number and inform me as soon as possible. Remember, this process can take anywhere from 30 to 120 days to complete, so patience is the key. I will stay on top of the lenders and of course inform you as to any status changes when they occur. Thank you for choosing U.S. Consumer Law Center. Sincerely,

Michael Rafael

Sr Loss Mitigation Processor

(800) 383-7956 x 254 Office

(949) 885-9811 Ext. 254 Direct Line

(949) 625-8670 E-Fax

mrafael@usclawcenter.com

www.usclawcenter.com

Posted by: Lynda at July 13, 2009 07:49 AM

Lynda - I have to ask.

When you got this loan - did you actually read the terms? Did you KNOW it was going to adjust in the future? What did you think was going to happen when it did that? Did you think it was going to go down? Were you aware it COULD go up?
What was your original rate?

Posted by: George Hanshaw at July 13, 2009 08:41 AM

I wonder if Lynda will response to George's questions?
I also wonder how Lynda got involved with usclawcenter.com. Is she too trusting?
She may have been better off had she checked with:
The Center For Responsible Lending
1330 Broadway # 604
Oakland, CA 94612-2504
(510) 893-9300
Looking up the center brought to mind Kathleen Day of S&L Hell fame. Never mind that she [allegedly] blames the current mortgage mess on everyone but gullible mortgagors. See http://newsbusters.org/people/kathleen-day.
Perhaps we need to accept that there are a lot of gullible people who need to be protected from their actions? Or should they just suffer the consequences? That might be too cruel. What to do?
By the way, Kathleen is, IMHO, a very impressive person. Read her book.

Posted by: Erik Kengaard at July 13, 2009 02:18 PM

Perhaps we need to accept that there are a lot of gullible people who need to be protected from their actions? Or should they just suffer the consequences? That might be too cruel. What to do?

There is an eternal conflict between giving people liberty and protecting them.

If people have freedom of speech, some will abuse it.
If people have freedom of religion, some will abuse it.
If we give people the right to make legal contracts, some people will screw it up out of their own stupidity.
Do we give people liberty or not? If we are going to have to pay the price for their stupidity, I fear the answer is not.

That's my best justification for believing in limited government. It allows people to make different choices than mine - as long as I'm not obligated to pay for them. Force me to pay for their choices (and you can make that 'alternate lifestyle' or whatever 'choice' you desire), THEN I FEEL IT IS MY RIGHT TO TELL THEM WHAT TO DO, SINCE I'M BEING COMPELLED TO SUPPORT THEM.

So, you want your freedom - great - just don't charge me for it.

Posted by: George Hanshaw at July 13, 2009 06:32 PM

Well, George, I'm not sure what to make of your response. I also believe in limited government - that government is best that governs least. I also realize that with people such as Pelosi, Barney Frank, Maxine Waters, et al in positions of power, the public is going to bail out the gullible, to some extent. And I conclude that gullible people won't do what they are told - by either you or congress.
I think the best we can hope for is that the bailouts be minimized, that gullibility and its consequences be publicized [who will do that? - not, apparently, Kathleen Day - nor do I think Lynda will help by responding to your questions), and that those who prey on the gullible be severely punished.
I have an idea - I'll call Gina Green and find out why Kathleen didn't blame the gullible.

Posted by: Erik Kengaard at July 14, 2009 05:50 AM

Interesting!

The loan modification process can be frustrating and confusing for many distressed homeowners. But you have to know what exactly is loan modification. A loan modification is a permanent change in one or more terms of a borrower's home loan.

Posted by: Mortgage Refinancing at July 21, 2009 11:48 PM

Wow! Pot calling the kettle black. These non-profits offering such free help, like Acorn, are hardly not for profit organizations. They, like the consumer counseling credit services, are politically steering all business their way so that they can receive more federal funding. Which are our tax dollars at work. So, either the individual pays for his own loan mod. or we all do by funding these "non-profit" orgs. By the way, all the profit goes to line the pockets of the executives and their political cronies receiving the kickbacks on their funding approvals.

Posted by: John at July 31, 2009 06:43 PM

Posted by: John at July 31, 2009 06:48 PM

Sorry, comments are temporarily disabled. We're doing a bit of server maintenance on the commenting area. We'll be back up and running shortly. Thank you for your patience.

Get Email Updates

Want the California Progress Report by email? Once a week, we'll send you the latest and greatest headlines.

Stat tracker

Advertise Here

Our latest headlines

About Us

Sponsors

Books

Legislators Square Off with Lobbyists on Mortgage Modifications

Comments

Get Email Updates