As I said in my last blog SB94 will have an effect on how consumers handle their mortgages SB94 has already passed the Senate and the community and now goes to the assembly there are many reasons to think this will help as well as many reason to think it would not, the bill it self is as follows 


          This bill would prohibit persons from charging advance fees to  

          borrowers in connection with a loan modification, and require  

          those who wish to charge a fee for loan modification services  

          (after performing them) to provide a specified notice to  

          borrowers regarding other options available to the borrower.   

          The violation of those restrictions would be a public offense   

          and subject the violator to a fine, imprisonment, or both. 

          This bill would additionally: 

           prohibit servicers from imposing any interest or charge for  

            performing services for borrowers in connection with loan  

            modifications or other forms of loan forbearance or  

            forgiveness; and 

           specifically prohibit any California Finance Lender Law  

            licensee from making a false, deceptive, or misleading  

            statement, representation, or omission in connection with  

            their lending or brokering activities. 


          On March 24, 2009, this Committee held an informational hearing  

          that focused on the serious problem of foreclosure related scams  

          facing delinquent homeowners.  Many of those scams involve a  

          promise to renegotiate a delinquent borrower's loan in exchange  

          for a significant up-front fee.  In arresting three members of a  

          foreclosure fraud ring in Southern California last November, the  

          Attorney General's office reported: 

The two women operated a company called Foreclosure Freedom,  

            which sent hundreds of fliers to Californians promising help  

            in stopping the foreclosure of their homes.  The fliers  

            read: "FINAL NOTICE - Respond only to this notice  

            immediately."  This is similar to First Gov scam, which the  

            Attorney General stopped late last year. 

            When homeowners called the number on the flyer, they were  

            told their mortgages could be renegotiated to a lower  

            monthly payment. Victims, however, were required to pay  

            thousands of dollars in up-front fees and were instructed  

            not to contact their lenders.  Victims were assured the  

            company had "private lenders and specialists exclusive to  

            their company who are very experienced in the options and  

            methods used to renegotiate home loans," yet neither of the  

            women who operated the company had real estate licenses, legal training, or any experience in the home mortgage  

            market.  Investigators found no evidence of any successful  

            loan modifications and most of the victims were either  

            forced into bankruptcy or lost their homes to foreclosure.  

This is just one example unfortunately there are many  more I mean if there was only two or three that did this the government would not get involved. Now we have a law going into affect and where does that leave us? There are not many choices, you can go to a Nonprofit  Housing Counseling Agency, or you could call your bank and see if they will modify your loan, or you can go to a company that reduces your principle balance, either way do not wait till you can not afford your payments, research every thing before it gets out of hand.

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