Consumer Law

300 California Law Firms Investigated for Mortgage Scams

By M. Stan Herring

MortgageLawNetwork.com has posted an article about a recent investigation into accusations against about 300 California law firms that were involved in loan modification scams, according to a California Bar Association report. "Typically, homeowners facing foreclosure complain that they paid attorneys who then did nothing to help them keep their homes.?

Mortgage modifications rarely work because the terms never go far enough to solve the long-term problem ? massive negative equity. The only way a homeowner can eliminate negative equity is by convincing the ?lender? that doing so is in the ?lender?s? best interest. This ONLY happens by fighting the foreclosure in the state court case. A good litigator can shift leverage away from the lender and toward the homeowner, forcing the lender to offer more meaningful solutions.

California has seen huge numbers of unemployment and foreclosures, yet homeowners all over the country should avoid lawyers who only do loan modification "workouts" with a loan servicer rarely achieve long-term success and the foreclosure likely won't be permanently resolved. You should never hire a lawyer who does not intend to defend the foreclosure in state court.

If you would like more information about foreclosures, please check out our articles The Three Stages of Foreclosure In Alabama and Wrongful Foreclosures In Alabama.

If you have more questions or concerns, feel free to contact us through our website or by calling 205-879-2447.

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Full post as published by Alabama Consumer Blog on February 01, 2010 (boomark / email).