Certain laws and regulations can get buried, forgotten and overlooked in the midst of financial crisis and/or management. Most people are unfamiliar with certain real estate laws until their finances or their property is in jeopardy. Here’s what you need to know about up-front fees for loan modifications in Florida.
Under Florida law, beginning in 2010, a company that provides loan modification services must have a Florida Office of Financial Regulation license. The office’s mission is to protect Florida residents by carrying out banking, securities and financial laws and to provide regulation of businesses that promote the development of Florida’s economy. The Foreclosure Rescue Fraud Protection Act is a regulation under this that makes it illegal for companies to charge up-front fees for loan modification services. This act came about after a record number of mortgage fraud and foreclosures were reported.
What you need to know is that this law requires that a contract be written and executed by both the person requesting the loan and the company offering it. The law applies to all Florida state businesses as well as businesses out of state that provide services to Florida residents. The only case in which a fee can be charged is if the loan modification results in a material benefit to the borrower. This will be stipulated in the loan modification agreement as well as the details of all services to be provided to the resident.
Make sure you check with your provider for all the details, and do not succumb to illegal fees and/or terms not listed in your agreement.
While the process can be complicated, help is available. Stephen K. Hachey, a Florida real estate attorney, can help you navigate this process and make the most of a difficult situation. Contact him at 813-549-0096.