Mortgage ‘Rip-Off’ Victim Gets Good News, Not So for Lawyer Involved

PHOTO: Ingrid Soriano

The ABC News Fixer loves a happy ending. And if the person associated with stressing out the consumer gets his comeuppance, well, that’s nice, too.

This week, the ABC News Fixer can report that both instances have occurred in a mortgage payment incident that has bedeviled two of our viewers – along with consumers around the country. Both women came to us for help after losing money to Rory Michael Alarcon, a young lawyer who ran the RMA Legal Network in New York, a mortgage modification business that promised financially strapped homeowners it would help get them affordable home loans.

Tune in to “Nightline Prime” tomorrow night for the full ABC News report.

The first victim, Ingrid Soriano, was saved from foreclosure last fall, after the ABC News Fixer intervened with Bank of America and Green Tree Servicing, which got Soriano into a modified mortgage.

And now the second woman, Barbara Hawkins, of East Setauket, N.Y., has just learned that after we intervened, Chase Bank agreed to put her into a trial mortgage modification beginning in May. If all goes well, we hope that will result in a permanent new mortgage for Hawkins, too.

Meanwhile, Alarcon, the baby-faced attorney who ran the RMA Legal Network, was disbarred in January by the courts in the State of New York, due to 74 complaints of professional misconduct from individuals in 30 states.

The disbarment was the latest embarrassment for Alarcon, who earlier was sued by the Lawyers’ Committee for Civil Rights, working on behalf of consumers including Barbara Hawkins. Alarcon settled that lawsuit by agreeing to stop practicing in the mortgage modification business and pay $50,000 in restitution.

Both Soriano and Hawkins described what seemed like a classic “mortgage rescue” fraud scheme, in which the company told them to fall behind on their mortgage payments and instead send money to Alarcon’s firm. They said they did as they were directed, in hopes that they would qualify for a government modification program.

But all they got was deeper in debt, with banks attempting to foreclose on their homes.

So-called mortgage rescue schemes can be quite sophisticated, and losses to American homeowners are at least $83 million, according to the Loan Modification Scam Prevention Network, which gathers complaints in partnership with local, state and federal law enforcement.

Homeowners who need help should check out www.preventloanscams.org to learn how to spot fraudulent offers and find help. A few red flags: A company guarantees it can obtain a modified mortgage, but only if the consumer pays them a large fee in advance. They may also tell homeowners to stop paying their current mortgage and stop communicating with their lender.

At www.HUD.gov, homeowners can find certified housing counselors. Another good resource is www.hopenow.com, a joint project of the lending industry and non-profit agencies.

- The ABC News Fixer

Got a consumer problem? The ABC News Fixer may be able to help. Click here to submit your problem online. Letters are edited for length and clarity.

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