Payment for loan modification assistance, is it legal?

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Icon Mini Profile jbielitz





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Post Posted: Sun Jun 07, 2009 9:48 pm    Post subject: Payment for loan modification assistance, is it legal?
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I paid a company outside of my mortgage lender for loan modification assistance & was able to get my mortgage lowered for 6 months. Since then, this company has moved twice & has been cited for bad business practices. Although I did get my loan modified, is it legal for companies to charge for this service?
Icon Mini Profile adonis
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Post Posted: Mon Jun 08, 2009 12:15 am    Post subject:
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Hi jbielitz,

If you hired a loan modification company to negotiate with your lender, then that company has the right to charge fees from you. I don't think it is illegal to charge fees for this service.

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Icon Mini Profile eric1
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Post Posted: Mon Jun 08, 2009 5:19 am    Post subject:
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It is definitely legal. You can hire someone to do anything...even watch your grass grow. The thing is that many people just pay too much for that service.

Some will argue that you can get the loan modified on your own. In some cases that is true. Especially when the bank has a modification process in place which simply requires the borrower to complete a form. In that instance, you do not need assistance. However, when you need to PLEAD YOUR CASE, you need someone to do that for you in most cases. Borrowers often do not know what to say or what NOT to say when asking for a loan mod. It has to be positioned in a way that makes sense for the bank.

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Icon Mini Profile robertsmith2005





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Post Posted: Mon Jun 08, 2009 8:27 am    Post subject:
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since you are hiring them for service, it is legal.
Icon Mini Profile gmakerley
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Post Posted: Mon Jun 08, 2009 1:29 pm    Post subject:
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legal yes...wise business practice? in my opinion, no...capital letters NO.

eric is right in that many times you need an advocate. the fha website is full of non-profit organizations that have trained counselors who can be of assistance to those who need it. mind you, they will do this for free.

i am adamantly opposed, frankly, to the requirement that you pay for something that can be had for free - especially when money is so tight that you can't pay your monthly mortgage payment (the whole reason for modification being necessary to begin with!).

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Icon Mini Profile Realgeni





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Post Posted: Mon Jun 08, 2009 10:04 pm    Post subject:
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jbielitz

Welcoem to the forum.

You paid for the service your hired them for. I think you are luck that your work was comeplted by this company.

There are lot fo people who have been let with no one to talk to after they paid the money.

Good luck and feel free to ask
Loan Mod dude

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Post Posted: Wed Jun 17, 2009 3:03 pm    Post subject: Legit
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What Eric said is correct.
I charged this client $1795 for the same service.
I got him a loan mod that suprised all of us.

Old loan was a $1.1mm at $6700 a month. New deal is 3.0% and $2800ish a month for 3 yrs. See the result on my site. No BS.

Saved this guy almost a quarter mill in interest.

Money well spent in my opinion.

efsoc.com

Look at the top one from WaMu
Its real.

If it were me that needed this, I would of paid 10k.
Icon Mini Profile Realgeni





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Post Posted: Wed Jun 17, 2009 7:27 pm    Post subject:
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Interesting

Looks like some of clients are not happy
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