Warning to Individuals Seeking Mortgage Loan Modifications

Unfortunately the magnitude of the mortgage crisis in this country has also created an increase in scam artists anxious to defraud the consumers needing help.  Unscrupulous individuals are spending a fortune on advertisement that is reaching consumers in desperate need of guidance.  Because these individuals are not regulated, they can make unfounded promises to lure the consumers into hiring their organization.  Fortunately, if you take certain precautions you could avoid being victims of these undesirables.

First of all, any individual who guarantees a specific result on the modification of your loan, is lying.  The Rules of Professional Conduct governing the practice of law expressly prohibit attorneys from making unfounded promises to the client.  This regulation is based on the fact that the results of the professional effort are always subject to certain circumstances beyond the control of the attorney. 

Secondly, insist on personally knowing the professional that will have the primary responsibility of rendering this service.  I believe that an interview is critical because it affords the consumer the opportunity to ask multiple questions that he/she must have with regard to the case.  During this meeting you will be afforded the opportunity to determine whether this professional is competent and is the most qualified person to represent your interests.  You should demand a full explanation of the loan modification process and even though it may be somewhat complicated, a trained professional should be able to simplify the explanation.

I am also compelled to warn individuals against attempting to modify loans on their own.  Even though I have found cases in which banks have voluntarily modified mortgage loans under terms favorable to the debtor, this is the exception, not the rule.  Unfortunately, the majority of the banks are not that generous with their clients.  There is a distinct possibility that certain debtors may not qualify for a loan modification.  No bank will agree to a modification if the debtor is unemployed.  The purpose of the negotiations is to reduce the mortgage payment to a level consistent with the debtor’s capacity to pay.  If the debtor is unemployed, his/her capacity to repay is non-existent and the bank will not agree to reduce the payment to zero.  In this situation, the debtor may have to explore the possibility of filing a bankruptcy proceeding or pursuing a short sale.

Last but not least, I must also warn you that due to the volume of people requesting loan modifications, the process is a long and tedious one.  Therefore, you must be very patient insofar as the majority of the banks do not have sufficient personnel to deal with the avalanche of applications.  It is difficult to determine how much time it will take to complete the process, because some banks have more personnel working than others and it is our understanding that the turnover is significant.  In conclusion, please recall that this field requires an experienced and disciplined professional.  Be suspect of individuals that are offering the services at a reduced price and promise miraculous results.  It is very likely that these individuals are making promises that they cannot keep.

Luis A. González
Attorney and Mediator
L. A. González Law Offices, P.A

(407) 649 - 8389