Folks, read this section of the Florida Law — there are similar laws in most states.
…… It is the further intent of this section to require that foreclosure-related rescue services agreements be expressed in writing in order to safeguard homeowners against deceit and financial hardship; to ensure, foster, and encourage fair dealing in the sale and purchase of homes in foreclosure or default; to prohibit representations that tend to mislead; to prohibit or restrict unfair contract terms; to provide a cooling-off period for homeowners who enter into contracts for services related to saving their homes from foreclosure or preserving their rights to possession of their homes; to afford homeowners a reasonable and meaningful opportunity to rescind sales to equity purchasers; and to preserve and protect home equity for the homeowners of this state.
Now here’s the problem — there are a lot of services out there that have seized upon the fraud in securitization, origination and other frauds (and there are a lot of them!) to try to sell you various services — from “audits” to “foreclosure defense” and more.
I’m in contact with a fair number of lawyers in this state on a regular basis, including some who are associates of mine locally. I can’t speak to the results elsewhere but I can tell you this — irrespective of the merits the judges here locally in this county typically will refuse to allow into hearings any sort of alleged evidence on the provenance of the note, transfers and similar things.
So the question becomes three-fold here when it comes to these firms and their services:
- What are you buying? If what you buy either isn’t admissible directly or doesn’t lead directly to something that is, you’re wasting your money. Since most people who are going through foreclosure are in trouble because they’re short on money in the first place paying for something that ultimately proves worthless is a horrible thing. This is especially true when the “something” is expensive!
- What is the track record of the organization in question? And I’m not talking about puffery either — if someone is claiming to be providing some sort of analysis of a mortgage and its provenance, what do they assert as both their qualifications and their successes? Note that general claims and words like “may”, “might” or “could” mean nothing — nor do generic charts of various processes. What you want to see are specific claims that can be checked — how many foreclosures were averted, how many were dismissed with prejudice (so they can’t be filed again a week later!) and similar? If you’re being led to believe you can get what amounts to a “free house” out of the deal, demand the seller prove that they’re responsible for others having that level of success with case numbers and specifics. If you’re being sold an analytical investigative product of some kind who’s preparing it and what are their credentials? If they claim to be an expert what courts have acknowledged them as an expert and in what role? Again ask for specific case numbers and check it via the clerk of the subject court. Everyone has a first time being a recognized expert, of course, but if you’re being charged a bunch of money you shouldn’t be the guinea pig — if you’re the test case you should be getting the work for free as if you win there will be thousands of others who will follow you (and gladly pay.) If you’re paying then you ought to be buying a track record, not a hope!
- If your state has a law like Florida does is this firm recognized in your state and is it in compliance? Most corporations doing business in a given state have to file as foreign corporations and register. I did when I ran MCSNet; “mail order” is of course different but we’re talking about buying something specifically tailored to your state here, and as such “mail order” is the wrong model! It gets tricky with all the convoluted “agency models” that people dream up — the trickier the firm’s business model is the more wary I become. Florida’s law explicitly prohibits a number of things with regards to these firms and their offerings. Specifically it applies to:
- (b) “Foreclosure-rescue consultant” means a person who directly or indirectly makes a solicitation, representation, or offer to a homeowner to provide or perform, in return for payment of money or other valuable consideration, foreclosure-related rescue services. (ed: Then there are a couple of exceptions – – like licensed attorneys and employees of the government.)
and it prohibits
- (3) PROHIBITED ACTS.—In the course of offering or providing foreclosure-related rescue services, a foreclosure-rescue consultant may not:
(a) Engage in or initiate foreclosure-related rescue services without first executing a written agreement with the homeowner for foreclosure-related rescue services; or(b) Solicit, charge, receive, or attempt to collect or secure payment, directly or indirectly, for foreclosure-related rescue services before completing or performing all services contained in the agreement for foreclosure-related rescue services.
Any firm that takes your money before it performs or completes the entire set of services you contracted for appears to be facially breaking the law in Florida. And these laws are no joke — the Florida Statute in particular can levy a $15,000 per occurrence penalty and criminal charges are possible as it’s part of the consumer protection statute. You’re not going to go to jail as a buyer of these services but the entity you buy it from might well get sued out of existence leaving you with nothing but a smoking hole in your checking account.
There are undoubtedly legitimate firms that provide real help to real people in this regard. But there are also a lot of firms peddling crap. I’ve seen some of it. I’ve also seen evidence of what looks like an agency (and in a couple of cases even multi-level marketing type!) corporate structure that leave me asking where the accountability is going to lie and what knowledge of the actual services and assistance is with the people doing the selling of these services (in other words, how much do they really know — are they actual experts or just salesmen?)
Please don’t take this to mean that I believe that the fraudclosure games are not real by the banks. They most-certainly are. I’ve traced enough of this stuff and spent more than enough time digging through PSAs and tracing notes to know that there’s a very high probability that many notes were paid off more than once, were sold more than once, and in many cases the entity trying to sue you for foreclosure isn’t the actual owner of the debt and maybe never was.
But none of this matters unless you can (1) document it and then (2) get a judge to listen.
If you can’t do both you lose. That’s how it works in court; it’s not, contrary to popular belief, what you see on TV. Real no-bullshit civil litigation is (a) expensive, (b) NOT a “slam-dunk” in virtually every case and (c) often costs more to prosecute than you can recover. In other words it is entirely possible to “win” and lose anyway — in fact, that happens a lot.
To achieve both documentation and getting a judge to listen you can’t see “may”, “might” or “could” in a report you need “is“, “did“, “did not” along with words like “violated” (and a statute cite) or similar, along with enough chops to get into court with your evidence — and even that is not a guarantee of success, it’s simply the first log you have to jump over before have a shot at success!
Finally, if you’re thinking you can come into court “Pro-Se” and beat these guys you’re playing with one arm tied behind your back against a guy armed with a chaingun. The odds are overwhelming that without competent counsel you’re going to get mowed down, lose, and perhaps get sanctioned in the process, adding more monetary injury to what you’re already suffering!
In short folks get a good lawyer before you spend one nickel on any such “services” and listen to him or her. If he or she tells you that you’re wasting your time and money because the judges won’t hear your case irrespective of the merits then don’t waste your time and money on “investigative reports” that even if they’re valuable will never be admitted into evidence. That lawyer will also know what your State Law says with regard to solicitations and services of this sort and whether whatever you thinking might help complies with that law. If it doesn’t then the entity selling it to you is doing an illegal thing and you have to ask yourself why you’d want to buy something you intend to use in a courtroom, directly or indirectly, from someone who is thumbing their noses at the very same court!
Be smart folks. Foreclosure and fraudclosure is a serious business and there are a lot of hinky games being played out there. The banks are definitely not innocent and they are also often wrong. But adding to your own financial problems by paying good money for something that winds up being worthless simply is adding self-inflicted injury to the screwing you’re already taking.
I like all my readers, and as such please don’t make that mistake.
Disclosure: Tickerguy is not an attorney but he’s employed ’em in the past as the CEO of an Internet firm and both used to hang out with some pretty high-power civil litigators and still does talk with them from time to time. If you need legal advice get out your checkbook and pen and prepare for a nice hole to magically appear on your ledger — it nearly always does when real legal advice and activity is involved.