New Breed......Same Scam

Our company was recently contacted by a “law office” that was systematically contacting companies in the loan modification industry. After talking with the gentleman for about 5 minutes, I realized that he had very skewed ideas of how loan modifications were done and who was legal and able to do them. Just like the other firms before them, he went on to explain how licensed attorney's are the only ones that are able to successfully and legally do loan modifications. I mentioned SB94 and how it specified licensed mortgage brokers as the ones that were not only legal, but actually have a professional background in what's required to get a professional loan modification(preparation of financial statements and documents, knowing what the lenders requirements are, submission to the lender, and ultimately getting a lender to say yes!). He agreed, and conceded that they will often outsource their modifications to brokers for their assistance for that reason. This was the first of three major holes in his presentation. Aside from contradicting himself on who was legal to do them, he clearly admitted that the “Attorney” he represents doesn't do ALL of the modifications himself as his presentation indicated. After 10 minutes, I realized that I was dealing with a new breed of con artist, but essentially the same scam.
Misrepresentation is one of the largest problems plaguing the loan modification industry. Aside from outrageous fees, and companies that have no intention or proven process for completion, companies that “bait” their customers by telling that an Attorney is going to be personally working the file from start to finish is a flat lie. In his written presentation to me, it says clearly that they are offering to pay “Independent Contractors” $1000 for their “non-legal work performed”. That work performed was described as the following: 1)Document Preparation, 2)Assisting the Homeowner with the Hardship Letter, 3)Assisting the homeowner with the completing the loan workout application, 4)Confirm that all income stated matches the income documents 5)Turning in a fully completed file with all documents, forms and items listed on the check list immediately. In the end, the offer was for the Independent Contractor to “sell” the customer on the idea that they were going to have everything done by the Attorney thus it warranted an upfront charge of $2495 that went into an trust account. Yet the instructions for remittance on the agreement was a cashiers check payable to the Attorney. This is of course prior to any additional charges that he would charge the customers if they were already in foreclosure, had a sale date, or were looking to short sale if the modification was unsuccessful. If your head isn't spinning yet, wait, it get's better.....
The “loop hole”, is that Attorney's are not subject to CA DRE laws and their regulations. The trust account is in lieu of an escrow account which has been deemed illegal. So in the presentation where it says that they can legally charge the customer upfront due to the trust account, I believe they are correct and that they have in fact found another hole in SB94. He seemed pretty proud about it, and when I explained that if called to the carpet that anyone who knew better would call them on it. He then went on to say that, “The State Bar can pound sand, because we're not doing anything wrong or unethical”, my stomach started to sour. I realized that this guy felt his law office was above the law, and for the most part he's kind of right. What they didn't explain in the presentation that although they may not be subject to DRE laws, the licensed mortgage brokers that they're looking to solicit are. Although we don't necessarily agree with the absolutely no upfront fee clause in SB94, our mortgage brokers nonetheless comply with it until specified otherwise. Furthermore, mortgage brokers that were doing loan modifications previous to SB94 were typically doing progression payments with their customers, where the customers DIDN'T have to pay everything upfront, but rather a very reasonable application, submission, and negotiation fee. However, as my platoon sergeant used to say, “I say jump, you say how high?”. This is the difference in compliance between legitimate mortgage brokers that are doing loan modifications and following the rules, vs. the Attorney's that feel they are above the law, and are still trying to make their big money while they can.
PMC is not only dedicated to our customers whom we service, but also to the longevity of the industry and it's regulation. This problem didn't happen overnight, and it's certainly not going to go away overnight. If companies were half as concerned about genuinely providing a valid service for fair compensation as opposed to doing the “rip and run” business model, then the industry wouldn't be under such speculation. Furthermore, the legitimate companies that do have their customers best interests in mind would not only have more flexibility to operate without such a high accounts receivable (as most legitimate companies do), and actually be able to work with State and federal agencies to get a long term solution, and get this economy moving in the right direction. Everyone agrees that it has to start with the mortgages, we also agree that the efforts thus far have been futile yet very costly, at what point will we agree that a reasonably regulated private industry business model is the way to go? PMC has not only answered the questions plaguing the industry for customers, and business professionals looking to help, but also for the state entities that are looking to regulate. PMC without question proved the safest, most cost effective, and fairest program to all parties involved.

If Mortgage Brokers Do Loan Mods...Why Do I Need You?

"If the states are endorsing mortgage brokers to do loan modifications, why do I need PMC?" The first reason is research. PMC has literally contacted thousands of mortgage brokers throughout the country inquiring as to their standpoint on loan modifications, their fees and processes. What we found was that almost all of them had only done one or two modifications, and they were semi unclear about what direction they needed to go. The ones that were doing more than that were charging between $2500-$4000 for their services. Many of them were doing them "old school", with not only inadequate protections for themselves and their customers, but certainly making substantially more work for themselves than needed. PMC spent six months, with numerous representatives working 5 sometimes 6 days a week to contact these brokers and establish our Negotiators. This is the time that was taken to take a good hard look, and separate the good, the bad, and the ugly!!!


The majority of the mortgage brokers have preconceived ideas regarding loan modification and may have limited knowledge regarding the process. I think of it like this...A house framer has the necessary core knowledge and tools to build decks and awnings, yet if he hasn't built them before, he will likely have to get a few additional resources in order to efficiently complete the job. This is what PMC offers the mortgage brokers (Negotiators) that have joined our team. Aside from having access to each other for consultation, blogging and exchange of ideas, they also have access to our full broker resource center. Similar to how a mechanic would get the "dealer service manual" to repair vehicles that he may not familiar with. PMC affiliated negotiators have every resource available to them in order to work toward their customers best interests.

Fees. Many mortgage brokers that are able to perform loan modifications simply won't. If their state prohibits them from charging ANY amount of fee before completion, then the broker is dependent upon that customer to actually pay once the modification is completed. Like most people, brokers can't pay their bills and feed their family on IOU's. Unfortunately, without an additional party involved the mortgage broker has no resource to turn to for help other than collection agencies. Many brokers that are performing loan modifications are trying to charge the same high fees that many of the illegitimate and "attorney affiliated" companies are charging (usually $3-$6K dollars). With PMC, both the customer and the Negotiator get the best of both worlds. The Negotiators have agreed to perform the loan modification for the customers for a VERY reasonable fee, and have agreed to not charge those funds upfront. Thus, it eliminates the ability for a customer to get "ripped off". The Negotiator clearly has a vested interest in getting that customer results, their paycheck depends on it! The Negotiators, aside from not having to field sales calls, has PMC's software and resources which makes their job 10 times easier. Additionally, PMC affiliated negotiators, are only assigned customers that have demonstrated the willingness, and ability to pay for their professional services, and furthermore have PMC in their corner to remind the customers of their obligations once completed. This has proven to be the best business model in the industry, for ALL parties involved.

Trust and Oversight. As with dealing with any other modification company, if it's just the customer and that company, there will ALWAYS be room for error and “he said she said”. Some brokers are having a difficult time getting their customers to trust them again, as they were "labeled" as part of the overall mortgage problem. Although this is a relatively unfair assessment, nonetheless it has effected those relationships. With PMC, the Negotiators aren't out trying to prospect for customers. The customers come to us/them. Aside from having a second chance to help their community, mortgage brokers can receive fair compensation for fair work performed and have excellent job satisfaction. PMC's proprietary software not only assists the Negotiator in their work, but it also integrates with the customers Client Dashboard. Here, the Negotiators progress can be tracked and the client will see exactly what he/she stands in the process. It not only reduces the amount of phone calls from customers, but it also eliminates the chance of the customers documents falling through the cracks or the customer not feeling informed throughout the process. With something as important as a home, no one wants to take the chance of things not going right.

PMC has had two instances of Negotiators that have experienced "fatal errors" with their computers. Without PMC's data storage, this would have been a dire problem for the Negotiators and left the homeowner clients in a tough spot. Even if the customers were able to reproduce the documents, the time frame to get caught back up could have easily cost someone their home. As it is, the Negotiator reputations remained intact and the homeowners lost no valuable time in process. PMC's software is not only extremely secure, but the information is stored with multiple levels of protection and redundancy. So even if our building burned, and the Negotiators computer crashed, PMC would be able to get that Negotiator back up to speed within 24 hours. This protection has not only proved priceless to the Negotiators, but to the customers that they are representing as well.

Most of the customers that contact us tell us that we have the best pricing and program and have provided them the most information toward making an informed decision. The majority of the brokers that we've talked with, whether they've decided to join the team or not, have agreed that PMC's business model is next the best in the industry and not only takes the customers best interests into consideration, but the licensed professional's as well. So whether you, or someone you know, needs assistance finding legitimate help with a mortgage, or you are a licensed professional looking to do your part please contact PMC today.

Maryland Targets Mortgage Scams

Recently there was an interesting internal news letter posted on the state of Maryland's Department of Labor, Licensing and Regulation's website. This newsletter exposed a couple of the current, housing crisis, scams occurring in the state. Each of these are nothing more then “copy cat” crimes that have recently been committed nationwide. These scams are not simply an accidental fault in process, or even an outright illegal operation. These “legitimate” businesses were, in some cases, literally stealing people's homes and equity. These operations made profits, in the millions of dollars, in a very short period of time. There are two major factors attributed to why this happened.

The first reason, of course, is lack of state mandated direction or options for troubled homeowners. The Maryland Commissioner of Financial Regulation, Sarah Bloom Rankin, was quoted saying, “Quite simply...do not pay, walk away. Call your servicer directly or see a non-profit counselor.” when she referred to any company that offers housing assistance for a fee. The majority of the applicants that are now coming to us asking for assistance have already been this route and tried contacting their servicer directly. Additionally many have also conferred with a non-profit counselor only to find that they are right back at square one. Furthermore, CNN Money recently posted an article showing that only 4% of the modifications that are applied for are actually approved. If our professional negotiators had no better than a 4% success rate, our company would have been shut down a long time ago. Furthermore we would have been vilified as incompetent opportunists taking advantage of distressed homeowners. Yet the people that have been elected into positions, to protect our best interests and help us make challenging decisions, are to this minute still advising their constituents to only consider a process that registers a confirmed 4% success rate. If the state would simply admit that their efforts in trying to handle this crisis have, thus far, been unsuccessful, then perhaps they would be open to alternative ideas for addressing the issue. Like other states, passing fair legislation that allows legitimate, licensed, mortgage brokers to perform loan modifications, would be an excellent first step. This would provide homeowners an alternative to the game of “Russian Roulette” troubled homeowners are now playing with con artists and scam companies. This would also provide structure and guidelines for the companies that are truly in the business with their customers best interests at heart.

The second reason is also related to the first. Legislation. HB 361 was written to give oversight to foreclosure consultants. Again, two major problems have occurred. When this bill was first drafted it specified licensed attorneys, licensed mortgage brokers, and licensed real estate brokers as those qualified to act as foreclosure consultants. Well...most “Attorneys” have very little to no experience in loan modifications. They either A) woke up one morning and decided to be a “loan modification attorney” or B) they are allowing some other “company” to use their name and license to circumvent the rules of the state. This has been proven in CA by the CA DRE, and the CA State Bar. Real Estate Brokers specialize in “short sales” right now. They typically sell real estate and do not contact lenders for approvals. Furthermore it would be impossible to have a fiduciary relationship for a loan modification due to the option of short sale if the modification is unsuccessful. Of the three, licensed mortgage brokers are the only ones with a professional history and background necessary to competently perform a loan modification. However, they are also the only ones that were literally “crossed out” in HB361, thus leaving attorneys and real estate brokers as the anointed ones. Virtually every other state either is currently writing legislation or already has written legislation endorsing licensed mortgage brokers as the “chosen few”. The second problem the Commissioner does not seem aware of is in the language of the legislation. Currently it reads that if an individual is “in foreclosure”, then anything further action related to helping the homeowner is considered a “foreclosure rescue transaction” and it is deemed that NO ONE can assist. Presumably, what was intended, is that once a customer is in foreclosure, that anyone that is engaged for help must adhere to certain rules and/or be professionally licensed. Unfortunately, rules are usually enforced on the “letter of the law”, not the individual interpretation. (of course there are always rare cases).

The bottom line is that if the state hasn't put out clear guidelines, how do homeowners know where to turn? Furthermore, licensed mortgage brokers that are willing and able to perform loan modifications, in the state , are obviously reluctant at this point. They clearly will not want to do anything that would jeopardize their professional accreditation.

I recently called the state hotline and talked to the licensing division. It was explained that mortgage brokers are, in fact, the ones that should be doing loan modifications. Unfortunately no one could direct me to where this could be seen in writing. In the past, we've posted blogs like this and the state's legislation was soon changed to reflect much of the information that we blogged about. For the sake of Maryland's residents, we hope that this is the case here as well.

State Bar Takes Action to Aid Homeowners In Foreclosure Crisis

Well you've heard it from PMC. You've heard it from the FTC and the Attorney Generals Office. We are very pleased to announce that the California State Bar has now joined the fight in exposing "loan modification Attorneys". In a recent article from the State Bar of California's Website, it stated that the OTC (Office of Chief Trial Counsel) has over 800 active investigations that are related to foreclosure complaints. The Interim Chief Trial Counsel Russell Wiener warned consumers to take special caution when seeking legal representation related to loan modification. He said, "Consumers should not be comforted by advertisements that claim the Attorney is a member of their State Bar, such membership does not mean the Attorney has any special knowledge, experience or expertise in the area of loan modification. In fact, it appears that many of the Attorneys offering these services have little or no prior experience in the area of loan modification." Amen.

The State Bar suggests that consumers be wary of Attorney's offering loan modification services under any of the following circumstances:

• The Attorney in Charge of the office is too busy or not willing to meet personally with prospective clients.
• The business demands payment of a large fee, even before obtaining a prospective clients basic income and expense information about the existing mortgage and present home value.
• The Attorney responsible for the business is not licensed to practice law in the state where the consumer resides.

PMC has spent countless hours researching legitimate Mortgage Brokers who are licensed, and have a desire to help people in their state and surrounding states. During your loan modification process, you will talk personally with the Broker, and they will NEVER be too busy for you. If you want to sue your neighbor, hire an Attorney. If you want a free pamphlet on how to do your own loan modification, contact HUD. If you want a professional that's going to take you from start to finish, charge you a reasonable fee, and keep you informed throughout the process, contact PMC today.

Fighting Mortgage Scams, Government Teams Up

There was a recent article on ABC news stating that State and Federal officials are trying to stop scammers who prey on those facing foreclosure. Last week charges were filed against a California based Loan Modification Company. One of the former employees was quoted saying, "They're convincing people to give money to them in advance, promising to do something that they're not doing, that they don't even have the resources, capabilities, knowledge or manpower to do,". This is the common denominator with these scam companies. Even with the best intentions, 98% of the time they simply lack the knowledge, the resources and overall the manpower to do what they're telling people they're going to do.

This is especially true when it comes to a "Law Firm" that's doing loan modifications. Have you ever been to an Attorney's office? There's generally one to two paralegals on-site per Attorney that's in the office. So if you have two Attorneys, you'd have a total of four people in the office, six if you're extreme. A GOOD processor can handle about 50 files at one time, effectively. Average modification takes about 60-90 days. Now, assuming that the "Attorneys" are doing the same work as their processors and not playing golf, that gives you the ability to reasonably handle about 300 files. If they're bringing in 100 new files a month, then in three months they will be at capacity. Assuming they start getting terms for their first months clients, they will consistently be behind the curve, and they'll have to either expand or stop. Most will choose to do neither as both entail eating into their profit. It's the perfect example of "biting off more than you can chew".... Unfortunately, it's the American Homeowner that ends up having to swallow the miscalculation, and ultimately lose their money and possibly their home when that company gets shut down. Just remember, if a company has substantially more "sales/sign up" people then they do back end processors, it's a pretty good indication that they will have a problem in the very near future.

My daughter is a Freshman in High School and like most girls her age, is overly concerned with her appearance. She's always looking at some "new and improved" way to help her maintain her weight. I'm old fashioned when it comes to fitness and I'm a firm believer that you can advertise whatever you want, it comes down to Diet and Exercise. Same holds true with processing loan modification files. You can have proprietary software, and flow charts, and bank contacts all you want. But unless you have the manpower and knowledge, the company will eventually fold and go out of business. It's kind of like when you go to buy a used car. Great paint job, awesome stereo system, leather interior, sunroof and all the other bells and whistles. That's all fine and dandy, but when the motor goes out on you....you're stuck making a payment on a nice looking that doesn't run. I think a lot of people will agree that those analogies carry true for a lot of things going on in today's world.

PMC has over twenty (and counting...) Negotiators throughout the country. ALL of them have spent their professional careers helping people with their loan applications, talking to banks, and ultimately getting banks to say YES. So they're not just Good processors, they are Great processors. The Negotiators that have contracted with PMC can easily handle 20 files a month. This means that PMC can reasonably enroll 200 clients a month, and EFFECTIVELY manage them without risking files falling through the cracks. PMC will double the number of contracted Negotiators by the end of year, thus doubling the amount of clients that can be effectively managed and processed.

PMC has the only business model in the industry that's actually proving effective. PMC offers the best service, at the best price and is the only company in the industry that offers you protection and recourse. Don't take a chance with a company that may not be around tomorrow, contact PMC today, and let us give you one less thing to worry about.

Federal Reserve Stands Pat on Low Interest Rate

In a recent article from RIS (Real Estate Information Systems), it was stated that there are signs of "winding down" on Federal programs available for the housing crisis. It noted that, "although the central bank will continue with its previously announced plan to buy $1.25 trillion of government agency mortgage-backed securities to support the housing market, the policy-setting committee “will gradually slow the pace” of this and some other purchases." It went on to say that policymakers announced plans to "wind down" their program of buying $300 billion of Treasury securities, another emergency measure that the Fed undertook to drive down long-term interest rates and prop up the economy. This is a clear signal to Homeowners that if you're looking for assistance with your mortgage through a Federal program, you better act soon. A perfect example of this was the Cash For Clunkers program. Just like the HAMP, great program but when the money is gone it's gone.

The article also pointed out that the Central Bank intended on keeping interest rates low. What this means to you is that if you're doing just fine and your credit score is great, chances are you can refinance or purchase a home and get a great interest rate. For the other 90% of the Country, it means that "available credit" from the banks is going to be very limited for a long time. If banks aren't making much money from their existing loans, then they don't have the means to put out more money for additional loans. This means that trying to refinance or purchase a home is going to be very difficult for quite a while. So although it's a Real Estate Cornucopia out there with Foreclosures, unless you're at the Top already, you're not going to have the capital or resources to take advantage of it. This is a perfect example of the "rich getting richer". You basically have a handful of people that have all of the money (banks, investors, etc...). They will keep as much of that money "by any means necessary". Which includes but is not limited to: not cooperating with homeowners for loan modifications, charging erroneous and excessive fees, threatening and misleading their customers, and spending quite a bit of money (commercially and politically) to cast a dark shadow on the loan modification industry.

If you go to buy a car and start talking with a car salesman, let him/her show you a vehicle. Once they start asking you "closing questions", stop them and tell them that you're going to call your friend that's in the car business and ask him what he thinks............like the banks are doing, you'll get a ton of reasons of why you shouldn't call your friend and how dealing with "just you and him/her" is the best way to go. If they can keep you up against the ropes with nobody in your corner, they're sure to win the fight. Moral of the story.......Don't wait for things to "just get better", they won't. Don't expect your lender to just hand you everything on a silver platter, read the news, it's not happening. Don't let your lender "sell" you on the idea that you don't need any help, if you're looking for a good modification, YOU DO. Last but not least....Don't let some con artist scam you out of your hard earned money, contact PMC today and let us help you fight the good fight.

Better Business Bureau Ratings......The Real Scoop

"Better Business Bureau...........A Rating Since 2004" This is the advertisement that I came across while searching for a BBB Accredited Loan Modification Company. I went to www.bbb.org , went to the USA site, typed in my Zip Code to Check Out a Business Or Charity. In the search field, I put Loan Modification. I clicked the box that says "Limit My Results to BBB Accredited Businesses" and hit search. I clicked on the first one that came up. It showed up that they had NR (No Rating).......but the advertisement said A Rating since 2004. When PMC first started, we contacted the BBB for accreditation. They said that we had to be in business for a year before they would give the accreditation. The company that we found started in March of 2004, so it's impossible for them to have had an A rating since 2004. It was stated that the business was listed NR, as the review was currently being updated. This business also happened to be rated through the D&B (Dunn and Bradstreet). When I went to Google, typed in the name of the company and followed it with "complaints", and a cornucopia of things came out. So here is a business that had an A rating through the BBB, rated through D&B, and has a ton of customer complaints. They haven't given me warm fuzzies on their criteria thus far.......

If you research the companies that are currently being investigated or have been shut down by the FTC for fraud and/or deceptive business practices, you'll find that in their Prime, they had an A rating through the BBB. It literally takes the BBB at least a month to actually change a companies rating after complaints start coming in. There was a company that was shut down with over 73 complaints to the BBB in the first 3 months, yet operated over half of their business time (in business for a year) with a B rating or better. It wasn't until 6 months later that the company was issued a NR, and eventually before shut down an F rating. How many customers lost their money and possibly their home because they solely relied on the BBB's accreditation? I believe it was in the thousands. This is one of many companies with very similar stories.

PMC currently has a C- rating through the BBB. We contacted them in February of 2009, they listed our inception as June of 2009. PMC has ZERO customer complaints, resolved or otherwise. So how does a business that has multiple complaints, and is listed on ripoff report.com get an A rating, yet a business that has ZERO complaints gets a C-? Simple. They paid the fees and pulled the strings. When you go to the BBB, you're relying on ONE source for information about a company. Be diligent in your research. If you Google something, you're pulling from Millions of articles and research tables as opposed to relying on one. I'm not saying the BBB is not a valid and viable source of information, but it is one of many resources you should utilize when trying to find a legitimate loan modification company. Like most things in life, "Don't put all of your eggs in one basket...". That's why PMC utilizes multiple negotiators in various states so that our customers are never put in the position of being ripped off. We always have a contingency plan to ensure our customers best interests. Contact PMC today and see what makes us a Different Kind of Company.