Protecting Your Home
“Live from the BBB” with Univision WXTV-Channel 41 March 25, 2009
Dealing with Foreclosure and Mortgage Problems
Key Points
Get Expert Advice. Foreclosure counselors at nonprofits can provide advice at no cost. It’s important to get expert help. Keep calling until you reach a qualified counselor.
Take Action Now. Don’t ignore foreclosure warning notices. Be sure to respond.
Be Wary. Not every loan modification package is affordable. Some are scams that can ruin your chances of staying in your home. Be wary if strangers contact you offering unsolicited loans or deals.
Show Good Intentions. Try not to miss a mortgage payment. If you have already missed a mortgage payment – start paying again right away, get expert counseling, and talk to your lender about making up the missed payment, while you work out a solution.
Federal Government: Making Home Affordable Plan (in English):
www.fha.gov and www.financialstability.gov/makinghomeaffordable
As of March 2009: many homeowners are now eligible for refinancing or loan modification help! Check these websites, or call 1-888-995-HOPE for details (in NYC call 1-646-786-0888).
If you are having problems paying your mortgage, it’s important to take the right steps – quickly. Scammers and dishonest lenders often contact home owners who are having money troubles. Find out how to avoid losing your home to a scam or unfair deal:
Contents
- Act Now to Stop Foreclosure
- Avoid Unfair Lending Practices
- Loan Modification Scams and Bad Deals
- Property Flipping Scams
- Foreclosure Rescue Scams
- Mortgage Elimination Scams
- Identity Theft and Real Estate Scams
- New York Laws: Foreclosure Prevention and Responsible Lending Act of 2008
- New York Laws: HETPA
- How to Find Help: National, New York, New Jersey, and Connecticut
Act Now to Stop Foreclosure
1. Act now - don't wait until it’s too late. If you are falling behind with your mortgage, or can no longer afford mortgage payments, take action right away. If you wait too long, it could be too late to save your home.
2. Get help from experts. Mortgage problems can be very complicated. Consumer helpers from nonprofits, government agencies, and volunteer lawyers can provide very important advice about what to do. These experts are often very busy. Be patient and call several places until you find someone with knowledge who can help you. Check to see whether you qualify for free or low-cost services.
3. Talk to your current lender about the problem now if you are having trouble paying your mortgage. Ask if there is a way to modify your loan to make your monthly payments more affordable, a way to reinstate your loan if you are behind on payments, or a way to “work out” your debt through a mutually agreeable option, such as selling the property.
Be persistent. Some lenders are hard to reach. If a lower-level person can’t help you, ask to speak to a supervisor.
If you can’t reach your lender, or can’t get the lender to help you, try to get expert advice or legal help to slow down the foreclosure process. You may need extra time to identify the correct mortgage owner, and it takes time to work out a solution to mortgage problems.
Don’t hide from your lender. Don’t ignore warning letters or phone calls.
4. Do your best to keep paying the mortgage while you talk to your lender. Try very hard not to miss a single mortgage payment. Once you miss a payment, your credit will be damaged, and it will be harder to pursue options such as re-financing. Sometimes home owners are told that they cannot get help unless they stop paying the mortgage. This is not good advice. If you have already missed a payment – start paying the mortgage again right away, and talk to your lender about making up the missed payment, while you work out a solution. Sometimes the mortgage lender will not accept anything less than full payment. If this happens, set aside money you might have used for partial payment in an escrow account, so you will have it ready. This money will probably be needed to help with modifying your mortgage loan or preventing foreclosure.
5. Be sure you know who really owns your mortgage. Your mortgage may have been sold to investors several times. This can be very confusing. Some home owners have been contacted by more than one company, claiming ownership of a mortgage. Try to find out who has a legal right to foreclose on your property – and who doesn’t.
If you are not sure who owns your mortgage loan, request that a company prove that it is the legal owner. A lender should be able to provide documentation of ownership.
You may need to seek legal help or expert advice, if you cannot identify the legal owner of your mortgage loan, or if you are not sure whether loan documentation is valid.
6. Avoid unsolicited “loan modification” deals from questionable sources, “home rescue” loans, “foreclosure rescue” or “foreclosure bailout” home buying plans, or “mortgage elimination” schemes. Unfamiliar lenders or businesses may call, knock on your door, put flyers and signs in your neighborhood, or even contact you through someone you know. These are often scam companies that offer loans or purchase plans on very poor or even fraudulent terms. Beware! Just walk away if someone tries to scare or pressure you into signing a deal.
Before you do business – get more information about the potential lender, business, or financial services provider. Call the Better Business Bureau, your Attorney General's office, your state Banking Department, or local Department of Consumer Affairs to ask about the company’s record and to check out its sales claims.
Be aware that a foreclosure rescue scammer who offers to talk to your lender for you may try to charge you a big fee for services that you might be able to do yourself for free.
7. Never sign away ownership of your property, unless you actually intend to sell your home to a qualified buyer on terms that are agreeable to you. If you wish to sell your property, be sure to employ independent, accredited professionals – such as real estate brokers and lawyers – who will represent your own interests, instead of the interests of the purchaser of your property. Check with The Better Business Bureau for information about business reliability.
8. Make sure you understand all fees and terms of any financial agreement that is presented to you. Never sign documents with blank lines. If you don't fully understand a document - don't sign it. Consider consulting an expert, like a lawyer.
For information about finding your own expert sources of help, see the How to Find Help section.
Avoid Unfair Lending Practices
If you are thinking of using your home as collateral for a loan, to get some fast cash – think twice. Or, if somebody tries to convince you that you can afford to buy a costly home, even if you have poor credit and a low income – watch out!
Unless you are careful, you could take out a loan that you might not be able to repay. This could lead to the loss of your home equity (the dollar amount of your home’s value that you actually own), or even the total loss of your home.
"Predatory" loans are provided to consumers on unfair terms or through unfair business practices. Unfair loans can be made to new or existing home owners for a wide variety of purposes, such as first or second mortgages, re-financing, home improvement financing, or mortgage rescue. Victims take out loans that they cannot afford, that have deceptive or unclear terms in them, that may include big hidden fees, or that cost more than is necessary given the person’s credit history.
Unfair lending practices can involve any of the players in the loan market: lenders, mortgage brokers, real estate brokers, attorneys, even home improvement contractors. Some lenders or brokers use frequent advertising and neighborhood visits to encourage people to take out loans. Others target certain communities, by advertising in a specific language, or targeting neighborhoods with high numbers of elderly home owners, residents in areas that lack branches of legitimate lending institutions, or home owners without much access to credit.
To protect yourself, keep these things in mind when you are considering a loan:
1. If you are having trouble paying your mortgage, get help from a foreclosure prevention counselor – check with local nonprofit groups or government agencies. It is very difficult to make wise decisions about loan terms when you are worried about money matters. You may need a trusted person to help you check out loan terms and find the best loan deal. Get expert advice, if possible. (See How to Find Help section.)
2. Adjustable rate mortgages (ARMs) can be very risky. Loans with terms that can result in sudden, big increases in your mortgage payment can be dangerous. If you are not sure whether you are looking at this type of loan, get help from someone with expertise.
3. Shop for a better loan – don’t assume that top lenders won’t consider you. Don’t assume that a local bank or credit union won’t give you a deal on a loan. Take a little time to comparison shop. You can check the reputation of a lender with the BBB at www.bbb.org.
4. Ask about loan payments and fees. Ask what the total amount of the monthly loan payment will be, including taxes or insurance fees. Ask whether other fees will be charged, and find out whether those fees are considered fair. Check the terms to see whether your total monthly payment amount could increase at any time in the future. Get all of this information in writing. Make sure you can afford the fees and the monthly payment both now and in the future.
5. Watch out for pre-payment penalties. Be sure you know whether there are significant financial penalties for re-financing, called pre-payment penalties, during any part of your loan term. That could really hurt you if you want to re-finance your mortgage to get a lower cost loan, or if you need to sell your home in an emergency. Check all the details before you sign. New York ALERT: New York State law now forbids pre-payment penalties for new sub-prime home loans. If you believe you are illegally being charged a pre-payment penalty, consult a professional counselor or legal adviser, or contact the New York State Banking Department (See How to Find Help section).*
6. Stay away from “no documentation” loans. Borrowers should be very wary if lenders offer to provide loans for significant sums without requiring extensive income documentation. It is too easy for loans of this type to be falsified by dishonest lenders, without your knowledge. Make sure that your income is correctly stated on loan applications and that the value of the home for which the loan is given is not over-inflated. Ask to see documents that make references to these facts. New York ALERT: New York State law now requires that lenders making subprime home loans must verify that the borrower has sufficient financial resources to repay the loan.*
7. Be suspicious of unsolicited loan offers. Unfair loans are marketed to victims through phone calls, door-to-door solicitations, flyers, or even invitations issued by members of religious or social groups. Legitimate lenders do not make actual loan offers until they know a lot about you and your financial situation. If you are unfamiliar with a lender, check it out with the Better Business Bureau.
8. If you re-finance your home, make sure the terms benefit you. It doesn’t make sense to re-finance in a way that could replace low-interest loans with high cost ones, suddenly increase your monthly payment, or put you at risk of losing your home. If you have credit card debt, try to work out a payment plan with your credit card companies instead of taking a new, risky “debt consolidation” mortgage on your home. You’ll have to pay fees for re-financing, too, so don’t re-finance your home repeatedly.
9. Take your time, and make sure you understand what you are signing. If the lender uses high pressure tactics to get you to sign, that's a big warning signal. Ask questions. Be sure you understand all the terms and conditions, before you take out a loan that could cost you your home. Make sure that the written loan terms agree with any verbal promises made. Don’t sign anything that you don’t understand.
10. Make sure that your attorney represents you – not the lender. It is vital for borrowers to be advised by a reputable, independent attorney who can fairly represent the interests of the borrower instead of the interests of the real estate agent or lender. For help in locating such an attorney, contact your local bar association (membership group for lawyers). In general, it’s wiser to find and choose your own expert advisors for important home purchase matters such as legal issues, home inspection, etc., instead of accepting suggestions from the lender or realtor. (See How to Find Help section.)
11. Don’t take out a loan that you can’t repay. Most important of all: don't take out a mortgage loan that you can't afford.
If you are not sure whether you can afford a loan, there are many nonprofit organizations that may be able to help you find advice. The Better Business Bureau, the Federal Department of Housing and Urban Development (HUD), or your state’s Banking Department may be able to refer you to sources of information and counseling.
Loan Modifications: Scams and Bad Deals
Recently, loan modification scams and unfair or inappropriate deals have become very common. Scammers may offer to provide a loan modification to save your home from foreclosure; typically they will demand a large fee in advance – often in thousands of dollars. These criminals usually take all the fee money, provide no services, and disappear. Other criminals may pretend to offer government grants, and they also usually charge big fees for items that are useless or that can be found on the Internet at no cost.
Legitimate businesses may also offer to help with loan modifications. However, sometimes these can be bad deals for the borrower. Some types of loan modifications could be unaffordable and might quickly lead right back to foreclosure.
It’s very important for borrowers who are considering loan modifications to understand all the options open to them, including whether they are eligible for real forms of government help, and whether they can afford the modified new loan. Borrowers also may be signing away certain rights by agreeing to a loan modification. It’s important to get good advice from a qualified person, before signing.
Loan Flipping: Loan flipping involves repeated refinancing, where prior loans are rolled into new loans on poor terms, often with large fees piled on top. It often leads to foreclosure. New York ALERT: loan flipping is now prohibited by law in New York State.
To avoid getting scammed: get expert help at no cost from a volunteer lawyer or a professional foreclosure prevention counselor. (See How to Find Help section.)
Property Flipping Scams
This type of crime affects home buyers and is increasingly common. Scammers purchase homes at very low prices. Often these are homes in or near foreclosure. The homes may be in poor condition.
After doing minor repairs to facilitate a quick sale, the scammers get a dishonest appraiser to issue a fraudulently inflated appraisal on the property. A dishonest home inspector may issue a clean report on the property. Then the home is quickly sold – “flipped” - at a big profit to genuine, unsuspecting home buyers. Or a fake buyer purchases the home at a huge price, abandons the property after the deal closes, and allows it to go into foreclosure. The scammers then share the big profits.
If the home is purchased by real buyers, they may soon discover that they are stuck with a huge mortgage on a home that is worth far less than they paid, and that may cost even more to repair. In some cases, the victims of a criminal property flipping scam may learn that they don’t even own clear title to their new home – but may still be asked to repay a mortgage obligation.
Property flipping swindlers may operate in “rings” or “one-stop shops” of mortgage brokers, lenders, appraisers, home inspectors, closing agents, and attorneys, all working together to strip would-be home buyers of their hard-earned savings. These groups of scammers typically try to convince home buyers that they can help them with all the details of the home purchase: but as a result, there isn’t anybody protecting the home buyer’s interests. Be sure you choose a reputable, independent attorney and home inspector who will represent your interests fairly; it’s usually not a good idea to rely on people suggested by a realtor or mortgage broker.
Even if you are not a victim of this scam yourself, you can be affected by it. Whole neighborhoods can be seriously harmed by property flipping schemes. When properties go into foreclosure, the unoccupied homes can be vandalized. Or the homes may be temporarily rented out to tenants who don’t take care of the properties. When property flipping has damaged a neighborhood, nice residential streets can lose financial value and become unsafe, in a very short period of time.
Foreclosure Rescue Scams
Foreclosure "rescue" or “deed theft” scams target people whose home mortgages are in trouble. Scam operators advertise over the Internet and in local publications, distribute flyers, and contact people whose homes are listed in the foreclosure notices. Scammers may get in touch through religious groups or other neighborhood groups; they often look like trustworthy people.
For example, scam operators might agree to pay off an overdue loan if the owner will move out of the home and sign over the deed to the property. In this type of scam, owners are given the chance to rent the home with an option to buy it back later.
The rent payment is often so high that it is not affordable, and the "tenant" is often evicted. Similarly, when the home owner wants to purchase the property back, the scam operator usually sets the price of the property out of reach. Unfortunately, the troubles of these home owners don't stop there. Instead, they often find out that the scammers have not paid the initial mortgage, which leaves the home owner not only facing eviction but also owing the amount of the original loan.
Equity skimming or equity stripping: This is a type of foreclosure rescue scam. Usually, the scammer asks the victim to convey deed to the property on a “temporary” basis, then refinances the property and “skims” or “strips” away whatever equity is left in the home. The scammer then often disappears, leaving the homeowner with the possibility of a second foreclosure suit.
New York ALERT: Under a new law, “distressed property consultants” are required to follow strict guidelines in their operations (see below). For example, they must offer detailed written contracts. Consumers have the right to cancel the contracts within 5 days of signing.*
Mortgage Elimination Scams
A similar type of con known as "mortgage elimination" swindles people out of their properties and large sums of money by pretending to manipulate the bank lending system. The swindlers may create fraudulent documents for their victims that supposedly release them from their mortgage obligations. Second loans are then taken on the properties in order to pay the fraud perpetrators.
Mortgages cannot be “eliminated” through phony claims that a loan is “invalid.” Common sense tells us that you cannot get rid of a legal debt simply by pretending that it is not a real debt. Even so, many victims fall for “mortgage elimination” schemes that feature this kind of claim.
Another feature of mortgage elimination scams involves having the home owner place the title to the home in a trust of some kind, or transferring title to the home.
Promoters of mortgage or debt elimination schemes have been known to argue that a bank loan is not a loan of "real" money; so they claim that the mortgage debt is not legal. Scammers may quote selectively from government documents issued by real agencies such as the Federal Reserve to support their arguments, or fabricate legal-looking information to present as "proof" to scam victims.
Home owners who sign onto such mortgage elimination programs may face potentially serious legal problems such as default on their original mortgage, foreclosure, difficulty selling the home when an irrevocable trust clouds the home owner's title, potential liability for failure to pay any additional loans procured by the trust, the possibility of being an accessory to criminal activity - even jail time.
Identity Theft and Real Estate Scams
Criminals may steal the financial identities of other people to commit real estate or financial crimes, such as cheating lenders out of large sums through fraudulent home purchase or re-financing schemes.
It’s a good idea to check your credit report regularly, to be sure you are not a victim of identity theft. This can be done for free, once a year, through the English language website at www.annualcreditreport.com; or by calling (877) 322-8228; at TDD # (877) 730-4104 for the hearing impaired; or by writing Annual Credit Report Request Service, P.O. Box 105281, Atlanta, GA 30348-5281. If you discover any transactions in your report that you did not authorize, you should report the possible misuse of your identity to all three credit services.
For more information in English and Spanish about how to fight identity theft, go to www.ftc.gov/idtheft.
New York Law:
Foreclosure Prevention and Responsible Lending Act of 2008
As of August 5, 2008, a new law became effective in New York State, called the Foreclosure Prevention and Responsible Lending Act of 2008.* This law is intended to protect consumers who have subprime loans and to help individuals who may be at risk of losing their homes to foreclosure. Several provisions of the new law establish criminal penalties for frauds related to foreclosure.
These provisions now apply to foreclosure actions in New York State:
Mandatory advance notice of legal action: As of September 1, 2008: At least 90 days prior to commencing legal action against a borrower, prior notice of the action must be sent by the lender or loan servicer to a homeowner who holds a sub-prime, high-cost, or non-traditional loan. The notice must contain referrals to qualified housing counselors, and also must request that the borrower contact the loan servicer. If the lender fails to provide this notice, it may be a defense for the borrower who is challenging a foreclosure action. This does not apply to borrowers in bankruptcy or to persons who do not occupy their homes.
Required settlement conferences and borrower’s rights: For foreclosure actions affecting private homes, involving a sub-prime or non-traditional loan issued between January 1, 2003 and September 1, 2008, the court is required to hold a settlement conference within 60 days after proof is filed with the county clerk that a notice has been served to the borrower. If the borrower appears in court without an attorney, the court may assign counsel. For foreclosure actions filed prior to September 1, 2008 which are not closed, the borrower has the right to request a settlement conference.
Proof of standing to foreclose is required: After September 1, 2008 – foreclosure complaints that are filed must include an affirmative allegation that the plaintiff was the legal owner of the loan, with legal standing to request the foreclosure proceeding.
New York State also now makes these requirements for new sub-prime home loans:
Not permitted: charging modification or deferral fees unless the modification is part of the workout process; pre-payment penalties; “call” provisions to accelerate indebtedness, except in cases of default; negative amortization loans; loan flipping; financing insurance or other products not related to the loan; financing significant advancements to facilitate future monthly payments; re-financing of special mortgages.
Kickbacks or other payments to mortgage brokers are prohibited, if charged for services that were not provided or in amounts out of proportion to fair value of goods or services provided.
Yield spread premiums are not allowed if they do not offset front costs, or if they are not clearly disclosed.
Teaser rates with a duration of under 6 months are also prohibited.
Lenders making sub-prime loans must verify that the borrower has sufficient financial resources to repay the loan.
New restrictions now apply to mortgage brokers and mortgage loan services in New York State:
Mortgage brokers must act in the borrower’s interest, fairly and in good faith.
Brokers must present borrowers with a range of appropriate loan options.
Charging or accepting any undisclosed compensation is prohibited.
Broker must disclose all material information that could affect the borrower’s ability to get the loan within three days of the loan application.
Improperly influencing the appraisal process relating to a home loan is prohibited.
Mortgage loan servicers must be registered with the Banking Superintendent, effective July 1, 2009.
“Residential Mortgage Fraud” is now a crime:
Fraudulent loans issued on or after November 1, 2008 are now grounds for criminal action as “residential mortgage fraud.”
Any person who prepares or provides materially false information for purposes of getting a loan, or who files false information with a county clerk for that purpose, may be charged with this crime. Borrowers who reside in the purchased property are exempt unless they have participated in the fraud knowingly, as an accessory to the crime.
“Distressed Property Consultants” are subject to new regulations:
Such consultants offer help in modifying a loan, arranging a work-out, responding to a complaint, or negotiating with the lender. This does not apply to lawyers, most lenders, and genuine non-profit counselors.
The consultant must provide a written contract to the homeowner setting out the services to be provided, compensation, and the consultant’s full contact information.
The homeowner has the right to cancel the contract within 5 days of signing and must be given a notice of this right, along with referrals to non-profit counselors and government agencies.
These consultants are not allowed to take payment for services before services have been completed; may not take power of attorney from the homeowner; and are forbidden to retain the homeowner’s original loan documents.
This summary presents our best understanding of the new law, but does not represent legal advice. If you have questions about the law, please seek counsel from a qualified lawyer with expertise in the foreclosure area.
Empire Justice Center summary from New York State Bar Association website:
New York Law: HETPA
As of February 1, 2007, a law called the Home Equity Theft Prevention Act (HETPA) took effect in New York State. The law is intended to protect people who are at risk of foreclosure or mortgage loan default.
The Home Equity Theft Prevention Act, or HETPA, applies to transactions that transfer equity in a home from the owner to a purchaser - generally, it applies to the sale of a home in foreclosure to a buyer who wants to purchase the home as an investment.
The law has established these new requirements to protect New York's consumers:
Consumers are entitled to cancel the agreement within a five day cooling off period - specifically, the "right to cancel" period extends to midnight on the fifth "business day", including Saturday but not Sunday, following the date on which you sign the purchase contract. Notices of cancellation of sale must be provided by seller to purchaser in writing.
Sales agreements must be in writing.
Agreements must be in English. If the owner's primary language is Spanish, the agreement must be in both English and Spanish.
The agreement must be signed and dated.
Lenders may not grant mortgages to equity purchasers if they know that the purchaser did not comply with HETPA requirements.
Contracts covered by HETPA must contain the following details:
Equity purchaser's complete contact information
Address of residence in foreclosure
Total consideration to be given by equity purchaser in connection with the sale: disclosure of all fees and payments to be made to the buyer, plus total value of the home to be sold, and a complete description of all terms of payment
Complete description of any services the purchaser has agreed to perform or promised
The time at which physical possession of the residence is to be transferred
Date when the residence will be vacated by the equity seller
Terms of any rental or lease agreement
Terms of any buyback or re-conveyance agreement
Notice of cancellation form that can be used to file a cancellation with purchaser if desired
Date on which the five business day "right to cancel" period ends
During the five-business-day "right to cancel" period, the following actions are not permitted:
Purchaser cannot induce seller to execute - or accept - any instrument of conveyance of any interest in the residence in foreclosure or default.
Purchaser may not record any document regarding the property sold with the county clerk.
Transferring any interest in the property to a third party is prohibited.
Purchaser may not give seller any consideration (payment).
The equity seller cannot waive or shorten his or her right to cancel during the five day period.
The purchaser is also forbidden to do any of the following:
Purchaser cannot represent that it is acting as an advisor or consultant to the seller.
Purchaser cannot represent that it is assisting the equity seller to save the house.
Purchaser cannot represent that it is assisting the equity seller in preventing a completed foreclosure.
The buyer of the house falling under the provisions of HETPA may not make misrepresentations or deceive the seller in any way, especially about the value of the house; the amount to be received as a result of the sale; how much time the seller will have before a home is put up for foreclosure auction; contract terms; the nature of any relevant document; or the seller's rights and responsibilities.
If the HETPA law is violated, the transaction may be rescinded (legally cancelled) by the equity seller within two years of the date of the recording of the conveyance. The equity seller may also bring an action for recovery of damages or equitable relief for violation of the law. A violation under HETPA is considered a Class E Felony and may result in a fine up to $25,000. The law is not retroactive. There are exceptions to HETPA: for more details in English about the law, go to www.banking.state.ny.us/hetpyrul.pdf.
2009 New York UPDATE: The 2008 Act described above also amended the notice provision of the HETPA law. Lenders must now include a special statement warning homeowners about foreclosure scams, and providing contact information for the New York State Banking Department as well as genuine sources of non-profit foreclosure counseling help. The notice must be included with any foreclosure summons and complaint covered under this law, as of September 1, 2008.*
How to Find Help
Check out potential lenders or financial services providers before you do business. Call the Better Business Bureau, your state Attorney General's office, your state’s Banking Department, or your local Department of Consumer Affairs to ask about the lender's record.
National
The Better Business Bureau®, www.bbb.org
When seeking reliable businesses, Start with TrustSM by contacting The Better Business Bureau for information. You can check on a company’s reliability history, file a complaint, or find a local BBB source of help, through the national website any time. Just go to the national website home page and input your zip code to find the BBB nearest you.
Get More Money Now – Más dinero ya
BBB Public Education Project on Money Management
www.bbbmoneynow.org
For BBB consumer tips about managing credit, debt, savings, and investment issues, and detailed links to resource information, go to the national BBB website for this project. The site contains detailed information about debt problems and finding appropriate help with credit counseling. The Get More Money Now program is generously supported by the FINRA Investor Education Foundation (formerly the NASD Investor Education Foundation).
Federal Housing Administration (FHA) and Treasury Department
www.fha.gov and www.financialstability.gov/makinghomeaffordable
The FHA insures millions of residential mortgages. Go to the FHA and Treasury Department websites to find information about the Federal government’s new foreclosure prevention plan, called the Making Home Affordable Program. This program was created under the American Recovery and Reinvestment Act of 2009 (“Recovery Act”). Details about eligibility for genuine homeowner relief under these government programs are available in both English and Spanish through the FHA website.
U.S. Department of Housing and Urban Development (HUD)
English: www.hud.gov/recovery; www.hud.gov/foreclosure
Spanish: http://espanol.hud.gov/recovery; http://espanol.hud.gov/foreclosure
800-569-4287 or TTY 800-877-8339
The U.S. Department of Housing and Urban Development (HUD) can help you find approved housing counselors. Qualified counselors can answer your questions about important financial issues such as loan modifications, and help you avoid foreclosure. The HUD website contains information in both English and Spanish about foreclosure prevention and also about other matters related to the new Recovery Act.
Homeowner’s Preservation Foundation
1-888-995-HOPE (4673), www.995hope.org
Free help for home owners in trouble provided by selected HUD-approved counselors.
NeighborWorks America (Neighborhood Housing Services)
English: www.nw.org/network/foreclosure/default.asp
This is a national network of 240 local community organizations working to combat and prevent foreclosure. With funds provided by Congress, it runs foreclosure counseling programs across the country. The hotline listed on their website is the same as the one listed for the Homeowner’s Preservation Foundation.
Local Help with Legal Issues
Local bar associations and pro bono legal groups can help you find a qualified attorney who will fairly represent your interests.
www.LawHelp.org: Visit this website and click on "housing" to see information about locating and qualifying for free or low cost legal services, in your state.
www.Findlegalhelp.org: This is the American Bar Association (ABA) website resource, which can link you to sources of qualified legal help in your state.
State of New York
Better Business Bureau Resources for New York
www.newyork.bbb.org (Southern New York State)
http://upstateny.bbb.org (Northern New York State)
www.newyork.bbb.org/protectingyourhome
www.newyork.bbb.org/protejasuvivienda
Contact the BBB to check on businesses or charities, or to file a complaint. The BBB can provide information about local sources of foreclosure prevention help. See our website resources at www.newyork.bbb.org/protectingyourhome or www.newyork.bbb.org/protejasuvivienda for extensive details about avoiding scams and finding qualified counselors.
New York State Banking Department
1-877-226-5697 (1-877-BANK-NYS)
www.banking.state.ny.us/hetp.htm; www.banking.state.ny.us/cshalt.htm
Call the NY Banking Department's Consumer Help Line at 1-877-226-5697 (1-877-BANK-NYS) for general advice - especially before you sign any agreement with a person or firm claiming they can save your home from foreclosure. Information is also posted in English on the website at www.banking.state.ny.us/hetp.htm. Information in English about New York State HALT campaign (Halt Abusive Lending Transactions), including contact information for complaints, and educational fact sheets: www.banking.state.ny.us/cshalt.htm
New York State Attorney General
English: www.oag.state.ny.us
Spanish: www.oag.state.ny.us/spanish/home.html
The Attorney General is New York State’s chief legal officer, and is charged with protecting the state’s citizens against fraud. Among other things, the Attorney General’s office handles complaints dealing with real estate financing and home improvement fraud.
HUD – New York State
www.hud.gov/offices/hsg/sfh/hcc/hcs.cfm?webListAction=search&searchstate=NY
Detailed list of HUD approved housing counseling agencies in New York State, in English. These are New York organizations able to help consumers. Click on the website above to view list.
New York State Consumer Protection Board
www.consumer.state.ny.us/home_improvement_initiative.htm
Click on the website above to view tips about foreclosure prevention in English.
City of New York
Center for New York City Neighborhoods
1-646-786-0888, www.cnycn.org
The Center for New York City Neighborhoods (CNYCN) is a new non-profit organization, created to coordinate and expand services to New York City residents at risk of losing their homes to foreclosure. Calls are answered 9:00 am to 6:00 pm, Monday through Friday. Operators will direct you to qualified sources of foreclosure prevention help in New York City.
New York City Department of Consumer Affairs
Center for Economic Opportunity -Office of Financial Empowerment (OFE)
3-1-1 or 1-212-NEW-YORK (1-212-639-9675) from outside New York City
www.nyc.gov/consumers
This is a new city program. Among other goals, the OFE aims to protect low income New York City residents from predatory lending, and promote financial education. The city’s Department of Consumer Affairs enforces consumer protection laws, handles some types of consumer complaints, and licenses businesses such as debt collection agencies and home improvement companies. Contact them for general information about sources of help in New York City.
State of New Jersey
Better Business Bureau Resources for New Jersey:
Website in English: http://newjersey.bbb.org
New Jersey Department of Banking and Insurance
This New Jersey agency protects and educates consumers about insurance, money matters, and real estate transactions.
Hotline (New Jersey only): 1-800-446-7467
Website in English: http://www.state.nj.us/dobi/index.html
Links to New Jersey consumer alerts, sources of help: http://www.state.nj.us/dobi/division_consumers/finance/personalfinance_menu.htm
New Jersey Home Ownership Preservation Effort: http://www.state.nj.us/dobi/njhope/
New Jersey Home Ownership Preservation Refinance Program:
http://www.state.nj.us/dca/hmfa/consu/owners/refin/
New Jersey Attorney General, Division of Consumer Affairs
1-973-504-6200
Toll Free in New Jersey: 1-800-242-5846
English: www.nj.gov/lps/ca/home.htm
This agency provides information on its website about mortgage lending problems, and contact information for complaints and inquiries about consumer protection issues.
New Jersey Housing Resource Center
English: www.nj.gov/njhrc/
Information in English on housing issues, with links to foreclosure guidance information.
HUD – New Jersey
www.hud.gov/offices/hsg/sfh/hcc/hcs.cfm?webListAction=search&searchstate=NJ
Detailed list of HUD approved housing counseling agencies in New Jersey. These are New Jersey organizations able to help consumers. Click the website above to view the list.
Legal Services of New Jersey Anti-Predatory Lending Project
Hotline, for in-state New Jersey calls only:
Monday-Friday, 8:00 am-5:30 pm: 1-888-LSNJ-LAW (1-888-576-5529)
English: www.lsnjlaw.org/english/placeilive/iownmyhome/aplp/index.cfm
Spanish: www.lsnjlaw.org/espanol/index.cfm
Legal Services of New Jersey (LSNJ) coordinates the statewide network of nonprofit programs which provide free legal assistance in civil cases to low-income New Jersey residents who cannot afford lawyers.
State of Connecticut
Better Business Bureau Resources for Connecticut:
Website in English: http://ct.bbb.org
State of Connecticut Department of Banking
Hotline (for Connecticut residents only): 1-877-472-8313
English: www.ct.gov/dob/site/default.asp
List of sources of help in Connecticut in English: www.ct.gov/dob/cwp/view.asp?a=2235&q=386114
The state of Connecticut has announced that consumers who are having mortgage problems can now call a Mortgage Foreclosure Assistance Hotline for helpful advice about what to do.
Connecticut Attorney General
1-860-808-5318
English: http://www.ct.gov/ag/site/default.asp
The Attorney General is the Connecticut’s chief legal officer, and is charged with protecting the state’s citizens against fraud.
Connecticut Consumer Protection Board
In-state calls from Connecticut only: 1-860-713-6300
Toll Free: 1-800-842-2649
Website in English: http://www.ct.gov/dcp/site/default.asp
This state agency is responsible for protecting Connecticut consumers from fraud or injury. Inquiries are accepted by phone; the agency prefers to receive complaints in writing.
HUD - Connecticut
www.hud.gov/offices/hsg/sfh/hcc/hcs.cfm?webListAction=search&searchstate=CT
Detailed list of HUD approved housing counseling agencies in Connecticut, in English. These are Connecticut organizations able to help consumers. Click the website above to view the list.
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© 2008 and 2009 by the Education and Research Foundation of the Better Business Bureau of Metropolitan New York, Inc. All rights reserved. Permission is given for this material to be duplicated and distributed, in unaltered form, at no charge, for public benefit purposes.
The contact information for resource groups in this publication is provided as a public service, but does not indicate endorsement by the Better Business Bureau, nor does it indicate that any particular nonprofit organization has met the BBB Wise Giving Standards for Charity Accountability.
For information about charities reviewed by the Better Business Bureau, please go to www.bbb.org, find your local BBB by inputting your zip code, and search for local charity reports with your local BBB. National charity reports may be viewed at www.bbb.org/charity. Charity reports for the New York City, Long Island and Mid-Hudson Region may be viewed online at www.newyork.bbb.org.
Likewise, information in this publication is not intended as legal advice or financial advice. Please consult a reputable attorney, credentialed financial advisor, or qualified counselor for professional help with such matters.
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Education and Research Foundation of the Better Business Bureau of Metropolitan New York
257 Park Avenue South, New York, NY 10010, 212-533-7500
3/23/09
