State Bar Reports Increased Calls About Loan Modification

A recent news release from the State Bar of California reports that they are receiving “an unprecedented number of calls from consumers and lawyers relating to the foreclosure crisis, prompting an Ethics Alert from the Professional Competence Office.”

Loan modification is the buzzword du jour and very popular with businesses who love to play fast and loose. They promise to help distressed homeowners get relief on their home loans, but often don’t do much of anything other than take the unsuspecting consumer’s money.  The prosecution arm of the State Bar reports that it has been getting almost 1,000 calls or inquiries a month from consumers concerned about lawyer actions relating to loan modifications and foreclosure.

Lawyers are getting phone calls from loan mod firms wanting to partner up with them because lawyers are exempt from California laws limiting upfront payments to loan mod firms.

“The most important thing is for lawyers to understand this area is fraught with danger from an ethics point of view,” Los Angeles litigator Jon Rewinski, who drafted the ethics alert, told the California Bar Journal.

Anyone thinking about hiring a “loan modification” expert should take a close look their qualifications, and consider wisely before going forward.