Loan Modification Group, is this fraud or legit?

O

OCMan_IHB

New member
My parents got a letter promising loan modification / restruturing service.



Their website is:http://changemyloan.org/



They claimed that they go through Fed programs to reduce the principal and payment with no equity and can combine 1st and 2nd. I got the break down of numbers and little bit too good to be true. The interest rate quatoed is 4% for 30 yr fixed with near $800 less per month and $80k reduction in principal.



Here is something that I'm not sure of. Their fee is $3000 but needs $1500 up front for their "lawyers" to start working on my case. The rest could be paid out on monthly payment. Also $1500 is money back guarantee if they can't get the loan modified within 6 months.



Is this fraud or can my parents directly deal with their lender and get the same result? I thought their was a book on how to do modification by yourself by writing to the bank and the book only costs about $30.



Thanks.
 
[quote author="OCMan" date=1250235416]

They claimed that they go through Fed programs to reduce the principal </blockquote>


You can stop right there. In practice, no bank is reducing the principal any meaningful amount. I've been looking for evidence that SOMEBODY got a principal reduction ANYWHERE for the past six months and nobody can produce one.



This is a scam designed to seperate the desperate and underwater from thier money. Sorry.
 
[quote author="OCMan" date=1250235416]My parents got a letter promising loan modification / restruturing service.



Their website is:http://changemyloan.org/



They claimed that they go through Fed programs to reduce the principal and payment with no equity and can combine 1st and 2nd. I got the break down of numbers and little bit too good to be true. The interest rate quatoed is 4% for 30 yr fixed with near $800 less per month and $80k reduction in principal.



Here is something that I'm not sure of. Their fee is $3000 but needs $1500 up front for their "lawyers" to start working on my case. The rest could be paid out on monthly payment. Also $1500 is money back guarantee if they can't get the loan modified within 6 months.



Is this fraud or can my parents directly deal with their lender and get the same result? I thought their was a book on how to do modification by yourself by writing to the bank and the book only costs about $30.



Thanks.</blockquote>


I would be very hesitant to pay money. I've heard a few of the stories from people who never got a thing, including their $1500 back (I also believe that's the exact number I heard). I hope you never deal with a business without first checking the BBB. The state is cracking down on these people big time, but I'm sure there are a few who have slipped through the cracks. Ask them for some references. I do believe there are probably others here who have some connections in this regard, so be patient for a few more responses, DON'T do anything yet. I too, have to agree with no_vas, there's been a lot of talk about principal reductions, not one real verifiable story that any of us here have found to my knowledge. A family is my neighborhood is packing up as we speak, the same family that told me they were getting a principal reduction a while back.
 
<a href="http://www.la.bbb.org/Business-Report/ChangeMyLoancom-100079994"><strong>BBB Rating = <span style="color: red;">F</span></strong></a>



"We strongly question the company?s reliability for reasons such as that they have failed to respond to complaints, their advertising is grossly misleading, they are not in compliance with the law?s licensing or registration requirements, their complaints contain especially serious allegations, or the company?s industry is known for its fraudulent business practices."

<em>

Here is their word on this type of business:</em>



"Foreclosure consultants generally offer to stop foreclosure on homes and/or assist homeowners in restructuring their mortgage. Some companies may imply that they have an affiliation with a mortgage lender, attorney or with a government agency. In most cases, the companies do not have affiliations with any government agency or any special relationship with your lender. Generally, mortgage companies will only deal with the borrower on any issue related to the loan.



Complaints concerning similar offers allege that these companies misrepresent their ability to stop foreclosure, that they fail to perform services as promised, and that they deny requests for refunds based on non-performance.



<span style="color: blue;">In California, it is unlawful for a foreclosure consultant to charge or accept any compensation until they have fully performed everything they represent they will perform. </span>California law also requires that any representative who solicits, induces, or causes a California resident property owner to contract with, or pay any consideration to a foreclosure consultant. In addition, the representative must hold a valid California real estate sales license. The representative must also provide the consumer, in writing, under penalty of perjury, a statement attesting that they are properly licensed. Failure to comply with these requirements renders the contract void. By law, the contract must also provide for a five day cancellation right, and no money may be collected prior to performing all the services set forth in the contract.



If your written contract does not inform you of your right to a refund or your right to cancel, you may cancel the contract at any time, without regard to the five day time limit. The Better Business Bureau suggests that property owners first speak with their lender before engaging a consultant."
 
[quote author="SoCal78" date=1250238212]<a href="http://www.la.bbb.org/Business-Report/ChangeMyLoancom-100079994"><strong>BBB Rating = <span style="color: red;">F</span></strong></a>



"We strongly question the company?s reliability for reasons such as that they have failed to respond to complaints, their advertising is grossly misleading, they are not in compliance with the law?s licensing or registration requirements, their complaints contain especially serious allegations, or the company?s industry is known for its fraudulent business practices."

<em>

Here is their word on this type of business:</em>



"Foreclosure consultants generally offer to stop foreclosure on homes and/or assist homeowners in restructuring their mortgage. Some companies may imply that they have an affiliation with a mortgage lender, attorney or with a government agency. In most cases, the companies do not have affiliations with any government agency or any special relationship with your lender. Generally, mortgage companies will only deal with the borrower on any issue related to the loan.



Complaints concerning similar offers allege that these companies misrepresent their ability to stop foreclosure, that they fail to perform services as promised, and that they deny requests for refunds based on non-performance.



<span style="color: blue;">In California, it is unlawful for a foreclosure consultant to charge or accept any compensation until they have fully performed everything they represent they will perform. </span>California law also requires that any representative who solicits, induces, or causes a California resident property owner to contract with, or pay any consideration to a foreclosure consultant. In addition, the representative must hold a valid California real estate sales license. The representative must also provide the consumer, in writing, under penalty of perjury, a statement attesting that they are properly licensed. Failure to comply with these requirements renders the contract void. By law, the contract must also provide for a five day cancellation right, and no money may be collected prior to performing all the services set forth in the contract.



If your written contract does not inform you of your right to a refund or your right to cancel, you may cancel the contract at any time, without regard to the five day time limit. The Better Business Bureau suggests that property owners first speak with their lender before engaging a consultant."</blockquote>


SoCal, thanks so much for checking yourself, you are a truly caring person. As you can see, I usually only go so far as to ask the person involved to check it, you go above and beyond :)
 
<a href="http://ag.ca.gov/newsalerts/release.php?id=1780&">Brown Orders Mortgage Foreclosure Consultants to Post $100,000 Bond or Face Prosecution</a>





<a href="http://ag.ca.gov/cms_attachments/press/pdfs/n1780_registry_list.pdf">List of companies being investigated by California AG</a>





The company you identify in the OP is on page 2 of list of companies about to get spanked by Brown.
 
Ok, so we all shot that one down. How does someone go about getting one of these modifications that only about 10% of the people who need them have somehow managed to get? I'm actually really curious. I fully recognize that the majority of people who want one, really don't need one, they need to get out as quickly as possible. But assuming that there are some cases in which it would benefit both the lender and the owner (obviously, not many), how does a person go about this?
 
[quote author="tmare" date=1250249074]Ok, so we all shot that one down. How does someone go about getting one of these modifications that only about <strong>0% </strong>of the people who need them have somehow managed to get? </blockquote>


Fixed that for you.
 
[quote author="no_vaseline" date=1250249298][quote author="tmare" date=1250249074]Ok, so we all shot that one down. How does someone go about getting one of these modifications that only about <strong>0% </strong>of the people who need them have somehow managed to get? </blockquote>


Fixed that for you.</blockquote>


Ok, I get it. So, are we all really in agreement that there are NO cases in which a modification will work for both the lender and the borrower? I think it's pretty obvious that it has to work for the lender and I guess therein lies the problem.
 
Thank you all. I wasn't going to do anything about my parents' loan but was very curious as to what they would do.



FYI,



I have a coworker who actually got his loan restructured through ING. His loan broker supposedly told him about ING's program. My coworker called them up and he said that because he had an interest only 5 ARM that's about to be reset next year, ING gave him 5 yr Adj with principal payment at 4.75%. This saved his butt because the payment increased only $150, he now is paying down principal, and bought 5 more years. He ended up paying $750 to ING but he didn't have any legal group or middle men.



Thanks again, all IR Bloggers.
 
[quote author="OCMan" date=1250250818]Thank you all. I wasn't going to do anything about my parents' loan but was very curious as to what they would do.



FYI,



I have a coworker who actually got his loan restructured through ING. His loan broker supposedly told him about ING's program. My coworker called them up and he said that because he had an interest only 5 ARM that's about to be reset next year, ING gave him 5 yr Adj with principal payment at 4.75%. This saved his butt because the payment increased only $150, he now is paying down principal, and bought 5 more years. He ended up paying $750 to ING but he didn't have any legal group or middle men.



Thanks again, all IR Bloggers.</blockquote>


Thanks for the story, I am still wondering if he somehow won't end up having some problems later on, but I like to hear these stories.
 
If they're having issues, and it's their primary residence, they can contact NACA. It's FREE. :)

https://www.naca.com/refinance/refinanceTenStep.jsp



I have yet to see anyone on loansafe.org claim they got a principal reduction, but there have been plenty of stories of rates that drop to 2% and climb back up to a fixed 5%, and other things that often make my gorge rise. There is a process to getting a loan mod, and from what I can tell, part of it is just knowing <em>who</em> to whinge at, and what buzzwords you need. The rest is simply getting lucky with who actually owns the loan.



In my (not so) humble opinion, you're best off seeing if loansafe has contact info for your loan servicer, and then going through the motions (stopping your payments, sending in a hardship letter, calling them once a week to harass them, etc.) If nothing else, it prolongs the 'free rent' period.
 
Has anyone actually seen or heard of a legit 3rd party modifying service? Not by brother's mother-in-law's hairdresser heard on one, but a real first hand situation? True success stories appear to be as elusive as both the Yeti and the Chupacabra (my word of the week!)



My .02c



Soylent Green Is People
 
[quote author="Soylent Green Is People" date=1250316747]Has anyone actually seen or heard of a legit 3rd party modifying service? Not by brother's mother-in-law's hairdresser heard on one, but a real first hand situation? True success stories appear to be as elusive as both the Yeti and the Chupacabra (my word of the week!)



My .02c



Soylent Green Is People</blockquote>


Since I haven't used them, this isn't the first-hand experience you're looking for, but Mr. Mortgage recommends Green Credit Solutions. Oddly, I just checked their site and it's no longer in operation... the site, that is... not sure about the company. <a href="http://www.getgreencredit.com/">www.getgreencredit.com</a>



Update: I just checked BBB. They are <a href="http://www.la.bbb.org/Business-Report/Green-Credit-Solutions-Inc-100079023">rated F.</a> Bummer.
 
[quote author="SoCal78" date=1250320356][quote author="Soylent Green Is People" date=1250316747]Has anyone actually seen or heard of a legit 3rd party modifying service? Not by brother's mother-in-law's hairdresser heard on one, but a real first hand situation? True success stories appear to be as elusive as both the Yeti and the Chupacabra (my word of the week!)



My .02c



Soylent Green Is People</blockquote>


Since I haven't used them, this isn't the first-hand experience you're looking for, but Mr. Mortgage recommends Green Credit Solutions. Oddly, I just checked their site and it's no longer in operation... the site, that is... not sure about the company. <a href="http://www.getgreencredit.com/">www.getgreencredit.com</a></blockquote>


I wonder if they might be on Brown's list also. The whole lack of real stories is exceptionally curious.
 
[quote author="Soylent Green Is People" date=1250316747]Has anyone actually seen or heard of a legit 3rd party modifying service? Not by brother's mother-in-law's hairdresser heard on one, but a real first hand situation? True success stories appear to be as elusive as both the Yeti and the Chupacabra (my word of the week!)



My .02c



Soylent Green Is People</blockquote>
<strong>

<a href="http://en.wikipedia.org/wiki/Chupacabra">Chupacabra </a>

</strong>

<img src="http://paranormaland.com/pics/chupacabra22.jpg" alt="" />
 
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