Blog
Consumer Finance Insights
February 18, 2021

Pennsylvania AG Sues Five Companies Involved in Alleged Mortgage Modification Scam

On July 26, 2018, the Attorney General for the Commonwealth of Pennsylvania announced a lawsuit against five Pennsylvania mortgage foreclosure companies and two company owners for cheating consumers into signing contracts to have their mortgage loans modified—but never delivering the services paid for—in violation of Pennsylvania’s Unfair Trade Practices and Consumer Protection Law, 73 P.S. § 201 et seq., and the Pennsylvania Mortgage Licensing Act, 7 Pa. C.S.A. § 6101 et seq.

According to the Attorney General, defendants induced homeowners to sign contracts with them by promising to perform home loan audits and provide mortgage modifications in return for cash deposits equaling thousands of dollars, but then failed to produce the audits or mortgage modifications.  In order to hide the scam, defendants allegedly told the homeowners not to contact their mortgage lenders or make any payments on their existing mortgages because they were “handling” negotiations on the homeowners’ behalf.  When consumers began to demand updates on the status of their loans, the defendants dodged their calls and offered no refunds.  According to the Attorney General, some homeowners were instructed by the companies to not pay their mortgages ultimately lost their homes in sheriff’s sales.

The lawsuit seeks injunctive relief and restitution of over $280,000 for all Pennsylvania consumers who have transacted with the defendants between 2008 and 2015.

The post Pennsylvania AG Sues Five Companies Involved in Alleged Mortgage Modification Scam appeared first on Consumer Finance Insights (CFI).