A look at Biden’s first week in office

This episode reviews last week’s inauguration of President Joe Biden, examining which housing issues the new administration has already taken action on.

Biden’s executive order will extend foreclosure moratorium

President Biden revealed his plan to sign 17 executive orders his first day in office, including am extension of the eviction and foreclosure moratorium to at least March 31.

If consumers aren’t holding lenders back, then who or what is?

The challenge for lenders and investors is understanding how to meet borrowers where they are without layering on risk or getting bogged down in third-party intermediation.

HomeBridge’s Brian White on diversity at a practical level

HomeBridge's Brian “Woody” White discusses ways to increase diversity within the housing finance industry.

Politics & Money

Scammers ordered to pay $18.5 million for preying on struggling homeowners

Money, buildings and cars are going to be seized

The owners and operators of a number of mortgage relief companies are now banned from offering debt relief services after being accused to running a mortgage fraud scheme that preyed on distressed homeowners.

The Federal Trade Commission announced Monday that the U.S. District Court for the District of Nevada ruled in favor of the FTC in a case against the masterminds of the scheme that took advantage of struggling borrowers.

According to the FTC, the scam was led by Jonathan Hanley and Sandra Hanley, and involved numerous companies, including: Preferred Law; Consumer Defense; Consumer Link.; American Home Loan Counselors; American Home Loans; Consumer Defense Group, formerly known as Modification Review Board; Brown Legal; AM Property Management; FMG Partners; and Zinly.

In the scheme, the scammers promised homeowners that they would help make their mortgages more affordable. The scammers charged consumers illegal advance fees and unlawfully told them to not pay their mortgages or to communicate with their lenders, a release from the FTC said.

According to the FTC, the schemers charged consumers $3,900 in unlawful advance fees and $650 monthly installments, and falsely promised expert legal assistance, touting a 98% – 100% success record.

They also allegedly misrepresented they would cut homeowners’ interest rates in half and reduce their monthly mortgage payments by hundreds of dollars.

The FTC accused the companies of using doctored government logos, falsely suggesting they were affiliated with or endorsed by the government’s Making Home Affordable loan modification program.

The companies also claimed to have “special relationships” with particular lenders and unlawfully told consumers not to pay their mortgages to or communicate with their lenders.

According to the FTC, consumers paid hundreds or thousands of dollars only to learn that the scammers had not obtained the promised loan modifications, and in some cases had never even contacted the lenders.

As a result, many people incurred substantial interest charges and other penalties for paying the defendants instead of their mortgage payments, and some lost their homes to foreclosure.

When the case was initially filed by the FTC in January 2018, the court levied a temporary restraining order against the companies, halting their operations.

Now that the court ruled that the companies violated the FTC Act and the Mortgage Assistance Relief Services Rule, the defendants are permanently banned from the debt relief business and banned from misleading consumers about the terms of services they offer, according to a release from the FTC.

Beyond that, the court also ordered the companies and their principals to pay an $18.5 million judgment.

The court order also requires that the contents of numerous bank accounts be turned over to the FTC, along with the proceeds from selling assets belonging to the scammers. Among the assets that will be liquidated are a “Park City, Utah ski chalet, an office building, a Mercedes Benz S550, and a Porsche Carerra.”

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