Industry NewsMortgage

Feds to restrict foreclosure rescue firms

FTC proposes ban on advance fees for help with loan mods
Published on Feb 4, 2010

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by CareyBot

Federal regulators say they intend to follow the lead of many states in banning for-profit companies from collecting advance fees from homeowners in exchange for promises to help them obtain loan modifications or avoid foreclosure.

A rule proposed today by the Federal Trade Commission would bar for-profit companies that work with lenders and servicers on behalf of homeowners to modify loans or avoid foreclosure from collecting payment until after such services are provided, and impose other restrictions on their practices.

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