July 26, 2011
Mortgage Assistance Relief Services (MARS) Protects Consumers
In an attempt to create protection for distressed homeowners who are susceptible to less than scrupulous firms promising to deliver loan modifications, the Federal Trade Commission (FTC) has recently passed the new MARS ruling (Mortgage Assistance Relief Services). This ruling is designed to protect distressed homeowners from mortgage relief scams. Explaining the ruling, FTC Chairman Jon Leibowitz said, “At a time when many Americans are struggling to pay their mortgages, peddlers of so-called mortgage debt relief services have taken hundreds of millions of dollars from hundreds of thousands of homeowners without ever delivering results. By banning providers of these services from collecting fees until the customer is satisfied with the results, this rule will protect consumers from being victimized by these scams.”
Potential Over-Regulation
The Federal Trade Commission’s quest to regulate the debt relief industry became official since the Federal Trade Commission has officially banned debt settlement companies from taking any advanced fees back on October 27, 2010. As a result, debt settlement firms may not charge any upfront or enrollment fees when hired to settle the unsecured debts of the consumer. To be sure, it is no easy task to unravel a credit card debt that has taken years, even decades to accumulate. And, clearly, much work goes into contacting, managing and negotiating with the consumer debt creditors. Yet, so many unscrupulous firms have forced state enforcers to bring nearly 300 cases to stop abusive and deceptive practices by debt relief providers that have targeted consumers in financial distress.
Key Points:
* They may not charge you upfront fees
* You can cancel their services at any time with no fees
* If they do not get you new terms that you agree to then you owe them nothing
* They must be 100% honest in all claims and use no deceptive advertising
* They must be upfront about any fees you may be charged
No Upfront Fees
I believe this is the greatest provision that will protect consumers. If these thieves cannot get money from you upfront that stops the companies from non-performance or just taking your money and running. But the key to this success if for people to know they cannot be charged an upfront fee.
Cancel services at any time
This will protect homeowners from companies who are not meeting your expectations. It could be they are not communicating properly and leaving you in the dark. It could be they are taking a very long time to perform. If the company or person who is helping you is not meeting your expectation then you may cancel their services and not be charged any fees.
Terms you agree with
This company performs the negotiations on your behalf and obtains for you some form of relief. They may not charge you yet. They must present to you, in writing, the details of the relief you will receive. You must agree to those terms. If you do not like the relief for any reason you may say no to it and owe nothing. You only pay if you agree with the terms of the proposal. They cannot charge you a fee just to see the relief. You have to see it and agree to it before anyone can charge you.
100% honesty
We would like to believe every company or person is honest with all of their advertising and dealings. Sadly, this is not the case. They use deceptive tactics to obtain your trust and business. They may make wild claims like 100% success rate or ‘I am an expert’ when they really are not experts.
Another provision under MARS is that companies/people cannot pretend to be part of the government by using words like Federal or American. In fact, Mortgage Assistance Relief Service companies have to go a step further and actually declare in writing in advance in all advertising (print, video, and web) that they are not associated with the federal government. They must be proactive in saying they are not part of the government and not approved by the government.
Mortgage Refinance
This government mortgage assistance program helps people who have lost a lot of their home’s value. People with no equity or negative equity and those who are consistent in their monthly payments qualify for refinance loans. The eligibility criterion requires that the loan has to be owned by either Freddie Mac or Fannie Mae. A person is ineligible, if the property value has plunged too low or if the loan is a jumbo loan. This refinancing option expires in June 2010.
One should realize the benefits of the government mortgage assistance programs. With the help of experienced and knowledgeable professionals, one can secure government aid to help make the mortgage payments.
Learn more about Obama Mortgage Relief Plan Qualifications.
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