Attorney General Richard Blumenthal and General Assembly’s Banks Committee chairmen Senator Bob Duff and Representative Ryan Barry have urged Connecticut Governor M. Jodi Rell to sign into law a legislation that will target fraudulent repo home rescue and debt negotiation schemes that victimize families and individuals who are facing financial difficulties.
The bill stated that nonprofit and for-profit debt negotiation and repo home rescue servicers should register with the Department of Banking, post a surety bond and pay license fees.
Duff explained that the increasing number of foreclosure properties in Connecticut have motivated many unscrupulous people to take advantage of the vulnerability and desperation of distressed homeowners. He said that con artists find their potential victims at notices of foreclosures usually published by mortgage lenders.
These con artists would use various strategies to coerce or duped distressed homeowners to allow them to negotiate their foreclosure problems. The promise of eliminating the foreclosure problem, even for a fee, has already victimized many homeowners who gave their last remaining money to foreclosure prevention fraudsters.
Duff urges Rell to sign the bill which he claimed is intended to help protect homeowners who are struggling to improve their financial conditions and solve their foreclosure problems.
Meanwhile, Blumenthal has also called on Rell to sign the bill which he said, would protect distressed homeowners and borrowers from bogus debt reduction and foreclosure prevention schemes.
According to Blumenthal, the bill would establish strict standards and licenses for debt negotiators. It would prohibit deceptive deals and would require clear disclaimers and disclosures about what homeowners will receive from debt and foreclosure prevention services.
He hopes that the bill would stop unfulfilled promises of foreclosure prevention, reduce mortgages, elimination of credit card debt and back taxes and restoration of un-blemish credit history.
The bill would also prohibit repo home rescue servicers to ask for upfront fees. They would be required to assess and notify homeowners of the chances and progress of reducing their debts or saving their homes from foreclosures.
Also, repo home rescue servicers would be required to have a written contract specifying all services and fees and to grant homeowners the right to cancel their contracts three days upon signing.
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