Minnesota AG targets foreclosure consultants
ST. PAUL, Minn. (Legal Newsline)-Minnesota Attorney General Lori Swanson on Thursday filed lawsuits against six out-of-state mortgage rescue companies she alleges were taking advantage of homebuyers facing foreclosure.
Swanson said the companies were charging struggling consumers up to $2,375 to save their homes but failed to provide the level of assistance promised. The companies are located in Alabama, California, Florida, Nevada and Oklahoma.
"We do not tolerate mortgage foreclosure consultants taking advantage of struggling homeowners who are already between a rock and a hard place in the worsening mortgage meltdown," Swanson said in a statement.
The lawsuits, filed in Hennepin County District Court, allege, among other things, that the companies violated a 2004 Minnesota law by
requiring consumers pay upfront mortgage consulting fees.
Swanson, a Democrat, said the law bars foreclosure consulting companies from charging consumers until after they have "fully performed each and every service the foreclosure consultant contracted to perform or represented he or she would perform."
The lawsuits seek injunctive relief, restitution, civil penalties, and attorneys' fees, the AG's office said.
The mortgage rescue companies named in the complaint are National Foreclosure Relief, Inc., a Nevada corporation with a California business address; Lewis Loss Mitigation, Inc. of Alabama, which also does business as Stop Foreclosure Center and Lewis and Associates Consulting.
The suit also names D.R. Financial Services Corp. of California, which also does business as D.R. Financial and Superior Home Loans; American Foreclosure Specialists, LLC, of Oklahoma; Mortgage Default Assistance, LLC of Florida; and Home Assure, LLC, of Florida.
From Legal Newsline: Reach reporter Chris Rizo by e-mail at firstname.lastname@example.org.