Beware of Mortgage Modification Scams

Many companies in this country offer false promises of mortgage relief.It is important to be aware of the signs of mortgage fraud to prevent these companies from taking your money. A mortgage scheme involving eight companies recently occurred in the US, and the businesses involved are now under fire.

The eight companies were found to be ripping off struggling homeowners by falsely promising help in avoiding foreclosures and lowering mortgage payments. Charging upfront fees, these companies collected millions of dollars. Now, such companies are being sued by federal and state officials.

Mortgage Fraud is No Joke

A joint law enforcement sweep called “Operation Mis-Modification” targeted law firms and counseling services that offered assistance in modifying mortgage payments. Officials explained that the firms were misrepresenting their services and giving promises that were never delivered.

On July 23, lawyers involved announced that these eight companies had violated federal law. Specifically, it is unlawful to collect fees from homeowners until they have actually received a written modification from their lender.

According to the Consumer Financial Protection Bureau, three of the suits filed against the companies involved payment of more than $25 million in illegal upfront fees. The Bureau’s director stated, “These companies pocketed illegal fees, taking millions of hard-earned dollars from distressed consumers, and then left those consumers worse off than they began. These practices are not only illegal, they are reprehensible.”

An advisory was issued by the Bureau to consumers, informing them how to identify mortgage modification scams. Some warning signs include demands for upfront payments and guarantees that a modification will be obtained. A company cannot guarantee that a mortgage will be lowered.

The Case of Stephen Siringoringo

One illegal operation had been going on since December 2010. The defendants involved were Garden Grove lawyer, Stephen Siringoringo, and his associates, Alfred Clausen and Joshua Cobb. Reportedly, this company would collect upfront fees ranging from $1,995 to $3,500 from homeowners. The Bureau’s suit explained that homeowners in “numerous instances received none of the promised services or relief.” When questioned by the media, Siringoringo did not respond.

The State Bar of California filed a disciplinary action against Siringoringo in 2012, accusing him of charging illegal upfront fees as part of a large-scale mortgage fraud scheme. Last December, a judge suggested that his law license be suspended for 18 months. Such suspension is pending appeal.

The Federal Trade Commission also filed six lawsuits against numerous other companies accused of perpetrating the same loan scheme. Lawsuits were filed in 15 states.InFlorida, Illinois and New York,a total of 32 separate suits were filed.

The Illinois Attorney General also recently stated, “These companies are nothing more than fronts for scammers, conning people out of thousands of dollars, while putting them at higher risk for foreclosure.”

If you think you have been the victim of mortgage fraud, a real estate attorney may be able to help you. Simon Law is dedicated to providing you with quality representation. With over 30 years of experience, the Las Vegas lawyer can handle virtually any real estate case. For more information about mortgage fraud, contact 702.451.7077 or

What is a deficiency judgment?

When you purchased your property, you gave the lender a promissory note to pay back a specific sum of money. If you later defaulted on your loan, a foreclosure proceeding may have occurred. At a foreclosure sale, hopefully someone will buy the property and pay the bank enough money to fully satisfy your debt. Unfortunately, in today’s market, this does not happen very often. When the lender does not get paid in full, a deficiency is created.

Nevada law is very specific as to how to either pursue or defend against deficiency claims. I have represented both debtors and creditors in these situations. The window of opportunity (or defense) in these matters in Nevada is relatively short. Let me assist you in pursuing or defending against such claims.

What is a short sale?

A short sale occurs when you are able to sell your property and convince your lender to accept a payoff on your loan of less than the amount you actually owe. Short sales are often considered by owners of property considered to be “underwater”. This means that you owe more on your loan than your property is presently worth.

Typically, if your lender will agree to take less than is owed and you are able to find a buyer to purchase for such lesser amount, a short sale may be approved.

It is wise to have legal counsel assist you in dealing with your lender, real estate brokers, the buyer as well as title and escrow. You also need to be aware of potential serious tax consequences that could result if this matter is not handled properly.

Notice of default

Have you received a foreclosure notice, commonly called a “Notice of Breach” or “Notice of Default”? If so, there are many issues and options to consider in responding to such document.

1. Most notices of default pertain to your failure to make a required money payment. However, the notice could also pertain to your failure to do something else required of you, which would be a covenant or promise default.
2. There are many notices and other documents that must be legally sent to you in a foreclosure proceeding and the notices will differ depending if the property is residential (your home) or commercial (business).

I can help you address any notices received and how to respond in order to best protect your interests.

What are the typical documents signed to obtain a loan?

When confronted with buying property, it is often necessary to obtain a loan in order to complete your purchase. Although your lender will present you with many documents to sign, the only ones truly having any lasting importance are:

1. The Promissory Note (or Note Secured by Deed of Trust). This spells out how much you are borrowing and the terms of how you will repay such loan; and
2. The Deed of Trust. This document generally spells out your obligations to maintain and insure the property, but more importantly sets forth the lender’s foreclosure rights should you fail to make payments.

Contact me for assistance in reviewing and helping you through all aspects of your purchase and loan transactions.

How do I rent or lease out my property?

Whether your property is residential or commercial will have a great impact upon how you should proceed. In either case, a written lease is essential. Without a written lease, should a dispute ever arise, the contest will become one as to which party the Court believes. Eliminate disputes – put your deal in writing.

Residential and commercial leases each contain drastically differing language. I have years of experience in negotiating, preparing, and drafting all sorts of leases. I have represented individuals, as well as business entities, both landlord and tenant.

How do I evict my tenant?

A successful eviction may depend upon on many factors, some of which are:

1) Is the property residential or commercial?
2) If residential, is the occupant elderly?
3) Whether residential or commercial, what is the reason for the eviction? It could be for:  non-payment of rent; the failure to perform a covenant or promise contained within a lease; possibly for the commission of a criminal act; or simply for causing a nuisance.

Let me guide you through this minefield. I can review your leases, make sure all required notices are given timely and properly served, and represent you in court should an eviction be resisted or contested. I can also help you enforce your lease and attempt to collect any money that may be owed you.

What is an escrow? What is title insurance? Why do I need them?

An escrow is a neutral person or company that:

a) Gathers together the buyer’s deposit money and loan proceeds in order to pay the seller the demanded purchase price for a property;
b) Obtains a deed from the seller to transfer title to the property to the buyer; and
c) Makes sure that the buyer gives the lender an enforceable mortgage for the monies loaned to purchase the property.

Title insurance is typically obtained for both the buyer and the lender. The buyer is insured that it owns the property. The lender is insured that it has a valid mortgage to secure repayment of its loan.

Escrow and title are very complicated and confusing. Let me help you fully understand the process and the agreements you are undertaking.

How do I buy a property at an HOA foreclosure sale?

Countless properties located in this state are bound by a recorded declaration of covenants, conditions and restrictions (CC&R’s) enforced by homeowner associations (HOA’s). When a violation arises because an owner has failed to pay association assessments, an HOA may commence a foreclosure similar to a mortgage or trust deed foreclosure.

After proper notices have been given, the HOA may conduct an auction sale of the property. The highest bidder, in excess of the amount owed the HOA, will get title to the property. You may thus be able to acquire these foreclosed upon properties for a relatively nominal amount, namely, the amount of the unpaid assessments, plus foreclosure related expenses.

But watch out! There may still exist other liens and encumbrances against the title. This area of law is presently in a state of continuous change.

I can investigate the property in which you are interested and advise you of any risks that may arise should you be the successful bidder.

Foreclosure Mediation

Before a lender is permitted to foreclose upon owner occupied residential property, it must give the property owner an opportunity to mediate, or resolve by mutual agreement, a loan default.

The owner must produce their financial information to a neutral mediator, along with a proposal to cure their default. The lender must produce documentation to prove they are the actual holder of the loan and also be prepared to try, in good faith, to reach a resolution short of foreclosure.

If the parties are able to reach a resolution, foreclosure may be avoided. At such mediation the parties may consider such things as deferring payments in arrears, modifying the terms of the loan, or possibly a short sale of the property (lender agreeing to accept less than the full amount due).

Only If the parties negotiate in good faith and are still unable to reach an acceptable resolution, may the foreclosure be allowed to proceed forward.

I would be pleased to discuss your options and represent you, as either lender or property owner, in foreclosure mediation.