Navigating the mortgage relief assistance maze: 8 questions you should ask before choosing a mortgage mitigation firm

A rapidly rising number of Homeowners now have a legitimate need for relief from

impending foreclosures, adjustable rate mortgages, and mortgage loans with balances higher than their home's current value. To meet this demand, "loan modification" companies were popping up everywhere in the past few years. Some of these companies are legitimate and capable of delivering what they offer. However, there are also a number of opportunistic individuals and companies who are taking money from people in need of real legal assistance that are simply not able to deliver the services and representation that a homeowner facing difficulties truly needs. Fortunately, many of those companies and individuals have been driven out of the business by legislators and regulatory agencies. Still, how do you sort through the remaining companies and firms to find the highest quality assistance available? The best way is to perform a thoroughinvestigation before entering into an agreement or paying any money for services.

You should find answers to the following questions before entering into an agreement with a loan modification company or firm:

1.) Who will be performing the actual services? Is it a law firm, a broker, or an independent processing company?

Only a law firm is bound by a tight set of legal and ethical rules that brokers and others do not have to follow. You should always conduct a thorough background check before you give money to anyone who offers to modify your loan. Law firms typically have advantages over other types of companies and your results can vary greatly depending on who is representing you.

2.) How long has the firm or company been performing modifications and can they show you a successful track record? Do they provide other legal services?

You should only deal with a law firm that has extensive experience in real estate law and financial hardship matters. Only an attorney can effectively act on behalf of a homeowner who has received a Notice of Default.

3.) Is the company licensed or bonded?

Quite simply, do not deal with anyone who is not licensed by the state and bonded.

4.) Is there a written contract that spells out exactly what the company will do?

You must receive full disclosure, prior to making a commitment, about all actions that will be taken on your behalf. Make sure that all verbal commitments for service are represented in a written agreement.

5.) Does the company have a Department of Real Estate approval to collect fees for loan modification?

Contrary to what you have probably often heard about paying upfront fees for mortgage relief assistance, if you are dealing with a company or firm that has not been certified to collect upfront fees, you should be suspicious of their status.

6.) What kind of evaluation is performed to determine the viability of your case BEFORE any money is accepted?

Your specific situation and objectives should always be reviewed by an experienced and knowledgeable attorney before a decision is made to proceed with representation. An ethical firm or company will not accept a case unless it meets the basic criteria for a successful modification. This cannot be determined without some preliminary evaluation of your case! (In CA, it is illegal for ANYONE to accept upfront fees for loan modification so beware of anyone who attempts to do so.)

7.) Does the firm or company guarantee specific results?

If any company guarantees you specific results, you should disengage immediately. No legitimate company or firm can guarantee what a lender will or will not do and each case is a separate matter with its own particulars.

8.) Does the company provide regular updates on the progress of your modification after the process starts?

What you should expect from your service provider should be spelled out in your contract. An effective firm or company will provide you with a specific individual, usually a Case Manager, who will be your contact for questions and updates on your case.

Your home is one of your most valuable assets. Choosing wisely when it comes to mortgage mitigation assistance is an extremely important decision for you and your family. Don't take chances! Do your homework to make sure that you are working with a firm that is capable of delivering on their promises and a firm that you can trust.

Navigating the mortgage relief assistance maze: 8 questions you should ask before choosing a mortgage mitigation firm

By: David R. Lies

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