Alleged Loan Modification Scamsters Pressed by Prosecutors
As the economy continues to remain weak, loan modification scams continue to make the news. A Maryland man has been charged with conducting a loan modification scheme with a particularly cruel twist, while the government’s new consumer finance watchdog has made its first move into enforcement of mortgage-related fraud.
An Owings Mills, Md. man has pleaded guilty to mortgage fraud after prosecutors alleged he took money from at least 48 homeowners to help them get loan modifications, then stole the monthly payments they thought were going to their lenders, according to a story in the Baltimore Sun.
Rodney Getlan’s scheme was worse than the usual method of taking a big upfront fee and then doing little or nothing to help, according to the newspaper account.
In addition to charging a fee, he also forged documents to make it appear that lenders had approved the loan modifications, according to the charging document. Getlan mislead into thinking they were sending their “new” monthly payments to their mortgage servicers even though the money was actually going to him, the state said.
Getlan offered his services to struggling homeowners for three years. Some of his clients have lost their homes to foreclosure. Mortgage servicers send out warnings before foreclosing, but Getlan reportedly changed the contact information on file with his clients’ servicers so notices would go to him instead.
Getlan could be sentenced to as many as 90 years in prison. The state is seeking a 40-year sentence with 10 years suspended, along with restitution of about $400,000 to the victims, the Maryland Department of Labor, Licensing and Regulation has said.
Sentencing is scheduled for Dec. 3.
The Consumer Financial Protection Bureau, newly established under the Obama administration, is in talks to settle charges that a California businessman falsely promised to help lower homeowners’ monthly mortgage payments, according to a report from the Associated Press.
The government in July accused Abraham Michael Pessar and another businessman, Chance Gordon, of misleading homeowners about their chances of negotiating lower mortgage payments. It says the two charged up-front fees and sometimes suggested that people stop paying their mortgages in order to qualify for lower payments – which are illegal under consumer protection laws dealing with mortgage loan modifications.
Pessar and Gordon allegedly marketed their service to struggling homeowners with mailed flyers and phone marketing, the government said in its complaint. Some of the flyers included the logos of government agencies and a Washington, D.C., mailbox address.
However, the government agency has filed papers indicating that Pessar has agreed not to dispute the allegations, according to the AP’s story.
Belsky, Weinberg & Horowitz has represented consumers in mortgage, bankruptcy and debt collection cases for many years. Although foreclosures are difficult to stop once they are started, our attorneys have represented individuals facing foreclosure for more than 20 years. We have achieved a very high success rate in stopping foreclosure sales, reorganizing client finances and helping with unpaid income tax problems through the use of the Chapter 13 bankruptcy process.
In Chapter 13, the foreclosure, repossession, garnishment, seizure or legal action is “stayed” or placed on hold and a court-approved reorganization plan is put into place which pays the creditors an amount to satisfy their claims. Clients obtain a fresh start without the burden of long-standing past due debt. This process saves the clients’ home, stops interest from accumulating and offers a great deal of emotional relief from pressing creditor action to collect debts.
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