AG Targets 30 Rescue Firms
New York attorney general Andrew Cuomo has expanded his investigation and is sending over 30 additional cease-and-desist letters to mortgage rescue companies warning them to “immediately end all misleading and illegal conduct.”
According to his office, a total of 213 companies have “now been put on notice.”
The AG’s ongoing investigation revealed that many companies routinely collect illegal upfront fees from homeowners on the brink of foreclosure and then fail to help them lower their mortgage payments or save their home as promised.
After sending cease-and-desist letters to over 180 mortgage rescue companies, Cuomo’s office received consumer complaints and uncovered more evidence indicating additional companies may be abusing New York homeowners.
Mortgage rescue companies target homeowners facing foreclosure by claiming to be able to modify home mortgage loans and lower monthly payments. Often, these companies engage in deceptive and illegal marketing practices to lure customers and then fall short on their promises.
“Many of these companies take money from homeowners who cannot afford to pay it and make a bad situation worse,” said Cuomo.
“We are telling these companies to immediately cease any wrongdoing and to make sure their business practices are all above board, or they are going to be held accountable by my office.”
The cease-and-desist letters warn mortgage rescue companies to end any illegal, deceptive, and misleading practices, including charging upfront fees for consulting services and failing to enter into written contracts with homeowners in the language homeowners use that fully disclose the exact nature of the fees and services to be provided.
As of May, there are 64,778 foreclosed properties in New York.
In May alone one in every 1,982 housing units received notice of foreclosure.