State sets sights on mortgage relief scams

by Justin da Rosa24 Jun 2015
New York’s attorney general has kicked off a public awareness campaign that is taking aim at “mortgage rescue” scams.

Many companies – including legitimate law firms – making false promises of offering mortgage debt relief are making off with client money.

“They take victims and they re-victimize them, and there is nothing lower than that,” Eric Schneiderman, New York’s Attorney General, said at a press conference Monday.

John Councilman, president of NAMB, says charging up-front fees for credit repair is illegal.

“Consumers need to make sure the people they work with are abiding by the state’s laws,” he told MPA. “They should only work with licensed originators.”

New York attorney Paulette Cooke told local news station WIVB4 that many of the scammers are law firms in Florida and California that are not licensed in New York. And many have already scammed New Yorkers out of thousands of dollars.

“Scammers are flourishing in this environment of fear and this environment of uncertainty,” he said.

According to Schneiderman, a New York couple – Gail Fortunato and her husband – fell behind on mortgage payments and paid a California company $1,500 to help them save their home.

However, when they contacted their lender, the Fortunatos were told they had never heard of the California firm.

“They had never heard from them, they had no record of this,” Fortunato said during the press conference. “It was then that we realized that we were scammed. They took advantage of us.”

“They take advantage of people when they are at their lowest and most vulnerable,” Fortunato added.

Related: Mortgage lender charged in $9.7 million scam


Should CFPB have more supervision over credit agencies?