Foreclosure Rescue Fraud Prevention Act Proposed By the Attorney General
A legislation focused on fighting foreclosure scams was announced by Attorney General Bill McCollum who filed a lawsuit against National Foreclosure Management a
South Florida based company and its multiple affiliates who allegedly defrauded at least 80 homeowners for a figure reaching up to about $1.7million.
Now doing business as American Home Rescue, National Foreclosure Management could not be reached for a comment since their phone had been disconnected.Bill McCollum said in a news release that the attorney general’s office was planning on taking action against dishonest people who attempted to exploit American homeowners desperate to save their houses. He claimed that in order to help keep families in their houses the attorney general’s office was tackling the growing problem from several different directions.
According to the Attorney General National Foreclosure Management purposely selected homeowners in the process of being foreclosed upon and offered them to hold the title to their homes for a year, provide them with cash and refinance their debt and provide them with credit repair counseling while the homeowner continued to live in the house. The company claimed that it would deed the house back to the homeowner at the end of the year after foreclosure was avoided and the homeowner had his credit repaired.
The lawsuit claims that once the company obtained the title to the house it would refinance the homeowners at inflated prices and charge fraudulent costs and fees. The company would then sell the house to an investor who would lease the property back to the homeowner at rates that exceeded the original mortgage payments and since the homeowner could not afford to pay this eviction was inevitable.
Seeking compensation for the affected homeowners, termination of the company and revocation of the mortgage brokers’ licenses the lawsuit was filed with the Florida Office of Financial Regulation.The attorney general also revealed his plans about the filing of an act sponsored by Clay Ford, Sen. Mike Fasano, Rep. R-Gulf Breeze and R-New Port Richey and named the Foreclosure Rescue Fraud Prevention Act. He claimed that this would ensure that the rights of homeowners are protected.
Senator Mike Fasano said that when people are about to lose their homes they are desperate for help and will look for any assistance available and sometimes, as he claimed, desperate homeowners tended to trust a wolf in sheep’s clothing. He said that
Florida homeowners should be protected from such situations. The legislation being proposed requires the following:
Cancellation period that lasts up to five days giving the consumer the option of canceling the agreement with the company proposing to rescue them from the foreclosure. It also requires customers to be notified and informed of their rights.
The proposal defines several terms. Including the following:
- foreclosure consultant
- foreclosure rescue transaction
- foreclosure-related services
- equity purchaser
According to the proposal any and all violation of the agreement will be subject to penalties included in the Florida Statutes, chapter 501 Part II and these violations will be tried as unfair and deceptive trade practices.
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I am totally against bailing out people who are foreclosing on mortgages they never should have taken out in the first place. You buy a smaller house, don’t go on expensive vacations and live on a budget. No government bailouts for stupidity.
I believe due to the inflated appraisals the bank pushed many Americans find themselves in a very difficult situation. It is unfair to say that so many were doing this out of stupidity or to be greedy i.e. expensive vacations etc. As a borrower you expect the bank to only lend you a maximum of 80% of what the house is worth, but when you find yourself in a situation where your house is only worth 50% of the appraisal/ morgage, who is to blame. The borrower who is trusting a bank, or a bank with all it’s finacial gooroo’s that are supposed to predict the finacial future. It all comes down to the banks got greedy, and now the borrowers are finding themselves paying the cost.