Two Charlotte Foreclosure-Help Firms Sued by Attorney General

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Charlotte Observer (North Carolina) (09/25/12) Dunn, Andrew
September 25, 2012
Charlotte Observer (North Carolina) (09/25/12) Dunn, Andrew

North Carolina Attorney General Roy Cooper is suing two Charlotte foreclosure-aid firms, alleging that they swindled customers by collecting upfront fees without actually helping them with their loans. The companies, Community Mortgage Assistance Program and Lender Exchange, have denied wrongdoing. The A.G.’s office also pursuing legal action against Wilmington-based Tidewater Financial, for a total of 16 such firms targeted by Cooper. The businesses have been telling distressed mortgage borrowers that they can help negotiate with their lender for a fee. It is against the law in North Carolina to demand upfront payment for foreclosure or loan modification help. "These schemes promise to help save your home but instead drive you closer to foreclosure," Cooper said in a statement. "Victims lose precious money that could pay their mortgage, and critical time that could be spent negotiating real loan modifications." The suit alleges that Community Mortgage Assistance Program promoted itself as a faith-based organization that negotiates with lenders to avoid foreclosure or reduce mortgage payments. The company allegedly collected upfront fees that usually amounted to $1,500. Lender Exchange operated similarly, reportedly often charging the equivalent of one month's mortgage payment for its services.
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