Housing
Attorney general: Don’t Pay to Join Lawsuits for Mortgage relief
SeAttle—If you’re faced with foreclo-
sure and thinking of paying to be part of a
class-action lawsuit, please think again.
According to the Washington Attorney
General’s Office, nobody should have to
pay to join a legitimate class-action
lawsuit.
The lawyers and marketers pushing
these suits charge upfront fees and fre-
quently promise results. In reality, liti-
gation is time-consuming and even a
qualified attorney can’t guarantee the
outcome of a case. Moreover, repre-
sentatives of a legitimate class-action
suit would not ask for money to join.
Homeowners should be especially
skeptical of offers from out-of-state
firms. They may not be familiar with
state law or even licensed to provide legal
services in Washington.
The Federal Trade Commission has
banned mortgage relief companies from
collecting fees until homeowners have
received an acceptable written offer from a
lender or servicer. Attorneys are not covered
by the rule, but they are required to place
any fees they collect in a client trust account
and abide by state laws and regulations cov-
ering such accounts.
The attorney general’s office also warns
that it is seeing companies pushing forensic
Homeowners should be
especially skeptical of offers
from out-of-state firms
fication process or reduce your loan princi-
pal.
Beware! The Federal Trade Commission
warns that there is no evidence that foren-
sics loan audits will help a homeowner
obtain a loan modification or other
foreclosure relie. That’s true even if the
audit is conducted by a licensed, legiti-
mate and trained auditor, mortgage
professional or lawyer.
Some federal laws allow you to sue
your lender based on errors in your
loan documents. But even if you sue
and win, your lender is not required to
modify your loan simply to make your
payments more affordable.
What can you Do?
mortgage loan audits and services with titles
like, “pre-litigation monetary claims pro-
gram.” So-called loan auditors, often
backed by attorneys, offer to review your
loan documents to determine whether your
lender complied with state and federal laws.
They claim they can use the audit report to
avoid foreclosure, accelerate the loan modi-
If you are facing foreclosure or can’t pay
your mortgage, contact the Washington
State Homeownership Information Hotline
at 1-877-894-HOME (4663). The hotline
can refer you to a free, state-approved hous-
ing counselor.
If you believe unlawful activity has
occurred in regard to your mortgage, you
should speak with an attorney. A homeown-
er may file a suit to challenge a foreclosure,
but they must do so prior to the foreclosure
sale.
If you are unable to afford a lawyer, con-
tact the Washington State Homeownership
Information Hotline at 1-877-894-4663
(HOME) for referral to the Washington
State Bar Association’s Home Foreclosure
Legal Aid Project.
The Attorney General’s Office cannot
stop a foreclosure or provide individuals
with legal advice, as the office is barred by
law from representing private citizens.
Homeowners should read the Washington
Foreclosure Prevention Resources Guide,
provided by the Seattle-King County Asset
Building
Collaborative
Foreclosure
Prevention Team and recommended by the
Attorney General’s Office and the
Washington State Department of Financial
Institutions.
More information at
www.atg.wa.gov/foreclosure.
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April 20, 2011 The Portland Skanner page 13