Manita Dadil :

How do you know if a company is legit?

Paul Molinaro Esq.

We fully understand the dire financial situation our clients face. EVERY one of our loan resolution or Bankruptcy clients is having money problems (or they would not need us). Thus, we have made our pricing affordable to people with very limited funds.

That said, we need to make sure we are paid, and we do not want to be just one more creditor of the many seeking to collect from our clients. We ask for full payment up front.

As to guarantees.

Lawyers do not guaranty the outcomes of their cases or matters. We are lawyers and zealously represent our clients. That is how we earn our fee… through the actual work we do.

If a loan modification does not work out (it happens), that is when we are of even more value to our clients. That is when they need help with a short sale, deed in lieu, advice on the foreclosure process, or bankruptcy. We are paid to provide legal services, not to “shoot for a loan mod, and see what happens.”

Ellen Jones on February 28th, 2009 8:31 am

Is the Better Business Bureau and good reference to check the legitimacy of one of these loan modification companies?

TJ Roberts on March 2nd, 2009 6:59 pm

Well said Paul,Im in a fix myself,and Ive been a REALTOR for 17yrs.There are a lot of angels,on the loan mods,some want money up front,? and there is no guarantee a loan mod will be approved even with a rep co.and you’ve loss 2 months to find out a no

The problem is when most of these people dont have any equity,so I have a different mindset,on chap 13 or sell

PaulMolinaroEsq on March 2nd, 2009 11:07 pm Re: “Better Business Bureau”

Well, the BBB seems to be giving all loan mod companies lower than expected ratings due to the fact that the field is getting filled with corrupt businesses. The legitimate companies are being spoiled by being in a bunch of rotten apples. That said, it is one of the sources you should examine, but not the only source.

PaulMolinaroEsq on March 4th, 2009 12:08 am

No way around it, many potential clients who call my office want to hear that we guarantee their loan modification. They have read promises of balance reductions and super low fixed rates on the websites sites of loan modification companies, heard the radio commercials, and opened their junk mail (both email and U.S. Mail).

We know what people have heard. But when one thinks it through, a guarantee is just plain ridiculous. Each loan modification is unique. Some of the factors at play are the borrower’s ability to pay, the hardship, the location of the property, the amount of equity to loan balance, the lender’s financial situation, the attitude of the negotiator at the lender, the timing (whether the month was bad for real estate sales or really bad for real estate sales).

So many things affect the outcome. One of the hardest parts of advising people on loan modifications is making sure that a person really wants to stay in their home. Sometimes, the home is just unaffordable, no matter how low the rate.

When someone makes $3k a month and they bought a $700k home with no money down, it might be time to face the facts. Letting the house go through short sale or otherwise and then renting might really be the best choice. This is a discussion I have with my clients, and I make sure they get an education on all their options. The decision is left to the client, but I make sure it is an informed decision.

Mike on March 5th, 2009 3:48 pm

My neighbor had a guy call him about a loan modification and said he was a lawyer. He said it would cost 3,000 dollars for his fee and he would take the cost of his house from 310,000 to 233,000 and bring his interest rate from 6.5 to 5, plus 3 months off from paying his mortgage. Now this sounds too good to be true.

Is there anyway this could be for real?

PaulMolinaroEsq on March 6th, 2009 12:43 pm

Well, I guess it could possibly under some special set of circumstances if the stars and planets are all in alignment… be true… but… how the heck would someone know exactly what interest rate and exactly what balance a person would get. Any such claims should be examined for misleading statements very carefully and then? Examined again.

Marvin Opiyo on March 10th, 2009 9:43 pm

If a scammer has already taken my money, then failed to modify my mortgage, can your firm sue them? How much?

2. Is there a statute of limitation when suing my lender for predatory lending? That is, if it has been more than three years since the loan closed, do I still have a case?

Paul Molinaro Esq on March 11th, 2009 11:19 am (Edit)

In general, California law prohibits a non-licensed attorney or a non-DRE approved company from taking money up front to handle a loan modification IF THE BORROWER IS IN DEFAULT. Violating California law on this matter might result in the illegal act-doer being hit with THREE times the charge for the service as a penalty. As to statutes of limitations, each statute sets its own limit and the same holds true for non-statutory laws.

(All my posts are for general information purposes only, and are in no way providing specific legal advice for any person or entity.)