FOLLOW UP: New rules to take effect aimed at protecting homeowners
HILLSBORO, Mo. (KMOX) — A follow-up to a story KMOX reported Tuesday. A Jefferson County man paid over two thousand dollars to a mortgage relief firm, getting no help in return, even nearly loosing his home.
But at the start of the year the FTC will institute new rules targeting those fees. As of January 31, 2011, mortgage and debt settlement firms can no longer ask for up front fees.
And more rules taking effect December 29th will prohibit those companies from saying they are associated with the government, according to Chris Thetford with the Better Business Bureau in St. Louis.
He says companies will also be “required to disclose to consumers that lenders might not agree to change the consumers loan.”
In addition, Thefford says debt settlement companies will be required to tell customers that they could lose their home, and their credit rating could be damaged if they stop making payments on their house.
The BBB in St. Louis has received more than 3500 complaints from consumers, many of whom said they were left deeper in debt by the mortgage and debt relief scams.
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