A New Jersey-based mortgage modification company has told a judge that it will discontinue doing business with consumers in the state of Idaho. A Legal Newsline report out of Boise broke the news of a settlement between state Attorney General Lawrence Wasden and Best Interest Rate Mortgage Company LLC on behalf of twelve complaining homeowners. Those consumers who sought mortgage modifications from the company will get refunds, as well as a moderate restitution for having been caught up in the company’s wrongdoing, said Wasden.
Best Interest Rate Mortgage will pay the dozen homeowners about twenty thousand dollars split between them and has agreed to quit its Idaho operations. The decision marks Wasden’s third success this year in stopping the activities of unlicensed mortgage modification companies; the previous two of which this year were Apply 2 Save Inc., and APS Northwest Idaho LLC. Wasden has stated that fraudulent mortgage modification schemes constitute “one of the most serious issues facing Idaho consumers.” The kinds of companies being taken into consideration by the AG’s office are those that charged consumers sizeable upfront fees to supposedly modify their troubled mortgages without actually leading to any results.
Wasden states that he became aware of the wrongdoing at Best Interest Rate Mortgage after a consumer filed a complaint about a direct mail item they had received. The item, sent by Best Interest Rate Mortgages, looked exactly like a government form and was actually an advertisement. Labeled as a form entitled “009-S Payment Reduction Notification,” the document listed the consumer’s address and mentioned a loan of one hundred fifty thousand dollars. It notified the recipient that “under the Economic Stimulus Act of 2008, the homeowner could qualify for a “Special modification program.” While impersonating a government form is not illegal in Idaho, many of the company’s other activities – charging borrowers upfront fees prior to a modification and not being licensed by the state Department of Finance – are definitely not. Best Interest Rate Mortgage was busted when an associate of Wadsen’s office called the toll-free number on the form and was connected to a company representative.
The company claims that it lawfully negotiated mortgage modifications with lending banks. The company charged somewhere between one thousand and eight thousand dollars up-front for its services. The exact fee varied based on the amount of the loan. The company did not formally admit to having committed any wrongdoing, but the settlement terms agreed to by both Best Interest Rate Mortgage and Wadsen’s office included the company no longer doing any business in Idaho and also no longer soliciting to its residents. The company will face a steep civil penalty if it is found to have violated the terms of the settlement.
Hopefully the Idaho Attorney General’s office will be this successful in its pursuit of others who have flouted state law with regards to not lending inappropriately to state citizens. It really is a shame that unscrupulous individuals would not only seek to take advantage of people by imitating government forms, but would also do so in plain sight of the law!
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