The Federal Trade Commission has been granted a preliminary injunction against a company that claimed it could make mortgages more affordable and prevent foreclosure.
The FTC has charged the mortgage relief operation with making false promises to homeowners. It says that the defendants claim a 99% success rate and guarantee success regardless of a homeowner’s situation.
The defendants falsely claim, the FTC says, that they work with certain lenders and government assistance programs.
Following an application, homeowners are told that a substantial mortgage payment reduction has been “confirmed” and are instructed to pay “closing costs” of several thousand dollars. The FTC charge highlights that this is illegal under federal law as payment must not be sought or accepted by mortgage assistance providers until lenders and homeowners have agreed a contract.
Further, the FTC says that the defendants tell homeowners to stop paying their mortgage lenders but do not point out the effect this may have on their credit rating.
Homeowners are also told that they should not contact their lender or mortgage servicer.
Case defendants and details
The defendants, charged with violating the FTC Act and the Mortgage Assistance Relief Services Rule [MARS Rule (Regulation O)], are: American Home Servicing Center LLC; Capital Home Advocacy Center LLC; National Advocacy Center LLC; Jaime Aburto, also known as James Aburto and Jamie Aburto, and doing business as A.H.S.C.; Marcus Fierro, Jr., d/b/a A.H.S.C. and American Home Servicing Center; Eve Christine Rodriguez, a/k/a Elizabeth Davis, Elizabeth Powers, Christine Rodriguez, Christina Rodriguez and Elizabeth Rodriguez, and d/b/a National Advocacy Group; and Sergio Lorenzo Rodriguez, a/k/a Sergio Lawrence and d/b/a National Advocacy Group.
The Commission vote approving the complaint was 2-0. The U.S. District Court for the Central District of California entered a temporary restraining order against the defendants on April 13, 2018, and a preliminary injunction as to American Home Servicing Center LLC, Capital Home Advocacy Center LLC, National Advocacy Center LLC, and Marcus Fierro, Jr. on April 26, 2018.
The FTC files a complaint when it has “reason to believe” that the law has been or is being violated and it appears to the Commission that a proceeding is in the public interest. The case will be decided by the court.
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