Even though Los Angeles is no longer in a foreclosure crisis, thousands of Angelenos still have underwater properties and are targets of scam artists promising to modify their home loans.
On Wednesday, City Attorney Mike Feuer announced he had filed criminal charges against two men who collected money from homeowners seeking loan modifications but failed to do the work.
Jorge Bolanos Santizo allegedly collected $1,600 from a homeowner in the Valley without performing any loan modification work. Eblin Balver allegedly ran a similar scheme on a Bellflower homeowner, who lost his house to foreclosure and never got back the $8,500-plus Balver had charged.
Home prices have skyrocketed since the recession, and economic forecasts show the L.A. job market is growing. Still, more than 2,000 Angelenos defaulted on their mortgages in 2015, Feuer said.
"Clearly the economy is turning around," Feuer said. "But there are still stubborn pockets of loan modification scams. There are still stubborn situations where people are underwater."
Earlier this month, a North Hollywood man pleaded no contest to grand theft for a mortgage modification scheme that targeted women in their 60s and 70s.
Feuer's office offered the following tips on how to avoid loan modification scams:
- Do not pay up front fees for services
- Do not make payments to individuals other than their lender or loan servicer
- Never transfer title to those promising loan modification.
The city attorney's office will be hosting symposiums on loan modifications in San Fernando Valley and South Los Angeles — two areas of the city that were particularly hard-hit by foreclosures:
- Jan. 23, 9:30 a.m., at Van Nuys High School
- Jan. 30th, 9:30 a.m., at South LA Sports Activity Center