Firms take struggling homeowners’ money, fail to save their homes
North Carolina Attorney General Roy Cooper is taking legal action to stop three Charlotte, NC area foreclosure rescue companies from charging high fees but failing to save consumers’ homes.
“So-called foreclosure rescue schemes prey on desperate homeowners, pushing them even closer to losing their homes,” said Cooper. “We’re pushing back by enforcing the law and giving consumers better options.”
Cooper announced that he has filed suit against the following companies and their agents: Robert E. Cassell, Jr., doing business as American Mortgage Assistance in Fort Mill, SC; Home Assure, LLC and its vice president Michael Grieco of Charlotte, NC; and Metrolina Mortgage Relief, LLC and its president Jeffery Mika of Charlotte, NC.
Cooper made the announcement at the Better Business Bureau (BBB) of the Southern Piedmont, which has assisted with the cases.
“Homeowners turn to foreclosure rescue services because it sounds like the solution to all of their problems,” said Tom Bartholomy, president and CEO of the BBB of Southern Piedmont. “We want homeowners to know that anyone who charges you an advance fee for foreclosure help is trying to scam you and is breaking the law.”
In 2005, Cooper worked with state legislators to make it illegal for any foreclosure assistance business to collect fees upfront.
In complaints filed in Wake County Superior Court, Cooper asked the court to bar the three companies and their employees from taking any money from North Carolina consumers for debt adjusting or foreclosure assistance services. The Attorney General is also seeking refunds for consumers, civil penalties and cancellation of all contracts.
As alleged in the complaints, American Mortgage Assistance, Home Assure and Metrolina Mortgage Relief solicit homeowners who are facing foreclosure through web sites and searches of court records. The companies deceive consumers with claims that they are experts who will be able to save them from foreclosure. They collect substantial fees from homeowners, typically equal to one month’s mortgage payment, and then promise to negotiate with their lenders. In fact, the defendants do not provide any meaningful help, or they fail to tell consumers that they cannot prevent foreclosure.
Homeowners’ stories, filed as affidavits with the complaints, illustrate how these companies operate:
• One Charlotte homeowner fell behind on her mortgage payments after losing her job. She paid Metrolina Mortgage Relief $762 for help after the company’s president, Jeff Mika, guaranteed she would not lose her house. The homeowner called Mika several times but got no help from him and eventually had to declare bankruptcy.
• Another homeowner was forced to move in with her daughter in Charlotte after Home Assure took $1,000 from her but failed to do anything to save her Anderson, SC home from foreclosure.
• A High Point couple paid $769.73 to American Mortgage Assistance for foreclosure relief. For three months, the company claimed it was negotiating with their lender. Ultimately, the couple was told they would have to pay $5,000 before the lender would agree to negotiate. Their home was foreclosed on in July.
“Homeowners who fall victim to foreclosure assistance scams lose critical time and precious money that could be better spent on real solutions,” Cooper said. “Many families are struggling to pay their mortgages, and it’s in all of our interest to help them avoid unnecessary foreclosures.”
Legitimate foreclosure assistance counseling is available at no cost from non-profit agencies throughout North Carolina, and nationally through the HOPE hotline (1-888-995-HOPE), which can connect North Carolinians with free resources in their own communities.
The Attorney General’s Consumer Protection Division received three complaints against American Mortgage Assistance, eight against Home Assure, and seven against Metrolina Mortgage Relief. Many of those complaints were shared with the Cooper’s office by the BBB. Consumers can file complaints with Cooper’s office by calling 1-877-5-NO-SCAM toll-free within North Carolina or visiting www.ncdoj.gov.
For North Carolina homeowners who are facing foreclosure, Chapter 13 bankruptcy may be an option. To find out how Chapter 13 bankruptcy might help you protect your home from foreclosure, call our Hickory office at (828) 327-2240 or our Boone office at (828) 262-0500.