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FTC Adopts Rules for Mortgage Modifications, Foreclosure Assistance 

November 22, 2010 -- The Federal Trade Commission adopted rules that ban providers of mortgage foreclosure rescue and loan modification services from collecting fees until homeowners have written offers from their lenders or servicers that they decide are acceptable. The rules aim to protect distressed homeowners from mortgage relief scams where operators falsely claim that, for a fee, they will negotiate with the consumer’s mortgage lender or servicer to obtain a loan modification, a short sale, or other relief from foreclosure. Many of these operations pretend to be affiliated with the government and government housing assistance programs, the agency said. In addition to the advance fee ban, the rules require mortgage relief companies to disclose key information to consumers to protect them from being misled and to help them make better informed purchasing decisions. All provisions of the rules except the advance-fee ban go into effect on Dec. 29, 2010. The advance-fee ban becomes effective on Jan. 31, 2011.More information 
 
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