posted by on Sep 22
Moreover, JAMES PARSA [#153389], a southern California lawyer who advertised his loan modification work on television through the state, resigned Oct. 21. He faced interim suspension from practice due to a 2001 misdemeanor conviction for sex which has a child under 18 that they never reported to the bar.
Parsa, 44, advertised heavily throughout California within the last many months, offering to assist homeowners facing foreclosure. Although he provided evidence for the bar which he was in fact implementing cases, an investigator uncovered two 2001 misdemeanor convictions for sex by having an underage girl. The bar court ordered that Parsa be added to interim suspension Oct. 16, but his resignation made the suspension moot.
Their state Bar created a 10-person loan mod task force in March after receiving a huge number of calls from homeowners complaining that lawyers have inked no work after taking fees purportedly to aid stop foreclosure. The task force had 738 active investigations underway last month.
It earlier released what they are called of 16 attorneys it absolutely was investigating for possible misconduct associated with loan mod. Four of the six who resigned or face inactive enrollment were on that list.
“We are very pleased we are actually capable to remove these practitioners through the practice of law quickly so that you can protect the population,” said Interim Chief Trial Counsel Russell Weiner.
Until last month, attorneys could legally accept advance fees from borrowers for residential loan modification work along with other types of mortgage forbearance services. Lawyers’ services were sought after by foreclosure relief companies and operators that may not otherwise receive payment until contracted or promised mortgage loan modification work was completed. However, on Oct. 11, Gov. Schwarzenegger signed SB 94, which prohibits attorneys and every other persons from collecting an advance fee for residential mortgage loan modification and mortgage forbearance services. The measure took effect immediately. Information about the modern law are in the Department of Real estate property webpage, www.dre.ca.gov.
New law prohibits advance fees for lawyers doing foreclosure work
Gov. Schwarzenegger signed Senate Bill 94 Oct. 11, immediately prohibiting any person, including attorneys and real-estate licensees, from collecting funding fee to execute foreclosure relief services. The new law, adopted just as one emergency measure, closes a loophole that permitted foreclosure scam artists to exploit the ability to charge advance fees.
It is currently unlawful for virtually any licensed attorney or real estate agent “who negotiates, attempts to negotiate, arranges, attempts to arrange, or otherwise not proposes to execute a mortgage loan modification or other type of home loan forbearance for a small charge or other compensation paid with the borrower … to claim, demand, charge, collect, or get any compensation until after the [attorney or agent] has fully performed each service the licensee contracted to complete or represented he, she, or it might perform.”
The advance fee prohibition for loan modification and forbearance services pertains to house containing four or fewer dwelling units.
The new law also necessitates the following written disclosure in at the least 14 point bold type regarding mortgage loan modification and/or loan forbearance services just before getting into any fee agreement having a borrower:
“It is not necessary to pay for an authorized to arrange for a financial loan modification or other kind of forbearance from the mortgage lender or servicer. You may call your lender right to obtain changing your loan terms. Nonprofit housing counseling agencies also offer these and other forms of borrower assistance totally free. A list of nonprofit housing counseling agencies authorized by the United states of america Department of Housing and Urban Development (HUD) can be purchased from a local HUD office or by going to www.hud.gov.”
If mortgage loan modification or another loan forbearance services can be found in Spanish, Chinese, Tagalog, Vietnamese or Korean, a translated copy of the disclosure above must be fond of the borrower in this language.
A violation in the law can result in fines and up to a year in jail.
The written text of SB 94 can be acquired at leginfo.ca.gov; visit “bill information.” Info is also available from your California Department of Real estate property at dre.ca.gov.