San Mateo Bankruptcy Attorney Talks About Loan Modification Attorneys
San Mateo Bankruptcy Attorney Talks About Loan Modification Attorneys
Due to the sub-prime mortgage crisis, millions of hard working consumers are facing problems paying their mortgages. With many of the adjustable loans about to “adjust” upwards, their difficulty in paying for mortgages will only get worse. As the fear of missing mortgage payment grows, consumers become desperate in their panic to save their homes. The confusing information coming from the government only adds fuel to the fire as there are daily messages that the government is releasing credit or passing laws that order lenders to work with their customers. From this mass confusion arises a new brand of unsavories preying on the uninformed.
The latest trend of mis-advertising is the “loan modification specialist.” These advertisers promise that lenders can have their loan modified to lower interest rates, place missed payments onto the back end of the loan, or even lower of principle. Although there are legitimate programs out there to help lenders modify their loans, the unscrupulous usually ask the nervous homeowner for money upfront then do little or no work on the case. The homeowner usually falls further behind because their precious mortgage money was paid to the specialist only to find out a foreclosure was started instead of a loan modification.
Lawyers are not immune to the lure easy money as well. Crafty loan modification scammers have been trying to “partner” with bankruptcy attorneys to get more money. The bankruptcy attorney is asked to put their name on the advertisement or even onto the loan modification service contract. Then the bankruptcy lawyer does no work while leaving it all to the “specialists.” These actions can be extremely unethical because the bankruptcy lawyer is fee sharing with non-attorneys, collecting fees upfront, or allowing the unauthorized practice of law, which are all not allowed. If a consumer hires a bankruptcy lawyer to do a loan modification then the lawyer is expected to make a good faith effort to provide actual legal services. Simply turning over the case to non-lawyers is not enough because the lawyer has no control over the quality of work being provided.
Therefore, any consumer considering hiring an attorney to do loan modifications should inquire who is actually doing the work. The consumer should also assume that any money they put forward will never be recovered. At the very least, consider consulting with a bankruptcy attorney to understand those options before paying somebody $3,000.00 for an unknown loan modification.
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