Loan Modification Company Wants Homeowners to Understand SB 94

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With advance fee agreements no longer accepted in California, homeowner education is vital.

On Monday, October 12, it was announced that California Governor Arnold Schwarzenegger had signed SB 94 into law, effectively ending the practice of loss mitigation companies charging advance fees.

American Mitigation Law Group, a law firm serving the California loan modification market, is a proponent of SB 94 and had been using the "No Advance Fee" model well before the law was enacted. The company is hopeful that cases of fraud in the industry will be significantly reduced as firms are held more accountable for how they charge for their services.

However, it's important to note that the passage of the law is only one step to curbing fraud in the industry. Homeowner education is every bit as vital because fraudulent companies can manipulate those that haven't been properly educated on the issue.

For example, the California Department of Real Estate has long maintained a list of individuals and businesses that were issued "No Objection" letters to their advance fee-based contract.

Even though the DRE specifically states on its website that these agreements are no longer valid under SB 94, some businesses may still try to use it on unsuspecting homeowners.

AMLG would like to make sure this does not happen and that anyone engaging in discussions about a loan modification is aware of their rights under SB 94.

As such, the company has established an SB 94 Frequently Asked Questions resource on its home loan modification website. Simply click on "Resources" across the top menu and select "California SB 94."

The questions and answers contained within the FAQ should help those in need of a loan modification better understand SB 94 and prepare themselves for any discussion with a loss mitigation firm.

Homeowners should be advised that many companies are struggling to become compliant with the new regulations under SB 94; however, AMLG, is doing business as usual after months of experience doing loan modifications in a manner now required by law.

Rather than struggling to become compliant, the company can focus all its efforts on its client's needs and it will be able to continue providing resources and assistance that make a difference to those in need of help.

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Nick Haselwander

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