Savannah Homeowner Warms About Up Front Modification Fees - Local news, weather, sports Savannah | WSAV On Your Side

Savannah Homeowner Warms About Up Front Modification Fees

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Joseph Gregory sits at his kitchen table showing me a stack of papers. "They said we figure we can reduce your mortgage payment by about 520 dollars a month," he tells me. "And being on a retirement income, I thought that would be great."

Months later, Gregory says he's out $3,500 which he paid to a company that promised to be a "middleman" between himself and his lender. He says last August, he began receiving letters from Mortgage Assistance Law Center, located in Naperville, Illinois. "They told me they would contact my lender and work to get me a loan modification but that I needed to pay them fees up front," he says.

Gregory says he was also told that it would be better to stop paying his mortgage. "They said often that people who are at least three months behind on their mortgage payments end up being considered for a modification more than someone who's current," says Gregory. "So I stopped paying my mortgage. As a matter of fact, that money, what I would have made in mortgage payments is what I used to pay the company the $3,500 for the fees."

But Gregory says several months later, the company told him he could not get the modification. "they said I could get a refund of my $3,500 within 90 days. That was four months ago," Gregory says.

He contacted News 3 because he said he wanted to educate others about "up front" fees for something like a modification. "People should not sign up for anything like this or be persuaded to do anything like this. Because now after getting all this information from my mortgage company, you don't have to pay to get a modification," Gregory said.

That was confirmed by Christina Parker-Gilbert from Georgia's Own Credit Union. " Generally, with a modification, you never have an up front payment," she said. "I would encourage people to check in person with their lender or credit union if they receive unsolicited letters."

Parker-Gilbert also cautioned homeowners about listening to any advice to stop making mortgage payments, especially if they're current. "I would always urge a second opinion about stopping your mortgage, it's never really a good idea,' she said.

When it comes to the company, Gregory thought he did enough homework, saying the name itself implies that they are legal experts. Norma Garcia from Consumers Union agreed, but said homeowners have to find out more before sending money to a company not even in their home state. "Mortgage Assistance Law Center connotes we have lawyers involved here and i think that would be a natural assumption for someone from the public to make. That for me, would be a red flag," she said.

Tom Joyce of the Better Business Bureau Serving Chicago and Greater Illinois told me he would check out the company after hearing of Gregory's concerns. He said Mortgage Assistance Law Center has an "F" and six complaints - 3 complaints regarding advertising and 3 complains regarding unsolicited ads/letters offering mortgage/foreclosure assistance.

Garcia advises consumers to be cautious about doing business with anyone sending letters. "The rule of thumb is if they keep seeking you out, you may not want to be anxious to do business with them," she said.

I tried calling the 800 number for the company and after identifying myself as a reporter, was given a second number to call. No one answered that line.

Gregory says he has been calling about his refund. "But now I get voice mail," he says. "when they wanted my money several months ago, there always seemed to be someone answering the phone."

Gregory says he just wants others to know they should not sign up for anything or be persuaded to do something without checking it out first

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