Federal and state officials have filed dozens of lawsuits against companies they say have been duping a growing number of home owners who are facing foreclosure with big promises to lower their mortgage payments or rescue them from foreclosure while collecting millions of dollars in illegal upfront fees from home owners, the Los Angeles Times reports.
Dubbed Operation Mis-Modification, federal and state officials are uncovering pockets of law firms and counseling services that they say are falsely offering assistance to modify mortgage terms or payments for struggling home owners.
Officials say it’s against federal law for companies to collect fees from home owners until the home owners have received a written modification offer from their lender or mortgage servicer.
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