Legal Question in Real Estate Law in California

Re: Foreclosures

Yes, you can authorize a non-attorney to negotiate with your lender, however, that person, who legally is referred to as a Foreclosure Consultant, is bound by a group of laws intended to protect you, as the consumer, from potential fraud. I will mention that there is a ton of fraud in the loan modification business right now - I've met with people who have paid close to $10,000 up front for a loan modification, and nothing was done by the company they paid.

The laws governing Foreclosure Consultants require two important elements - first, they must provide you with a written contract which states the cost of their services, what they promise to do for you, and some reasonable time frame in which they will accomplish it. Second, you cannot be charged an up-front fee by a non-attorney for these services and are only required to pay once they have completed the work. If the person is licensed by the Department of Real Estate (a real estate salesperson or broker), then their contract for services must be approved by the Commissioner of the Department of Real Estate before they can require you to sign it.

Be very careful - the advantage to using an attorney to handle your modification is that with a professional license at stake, you are less-likely to encounter an outright fraudulent player - its not a guarantee, but it certainly improves the odds. Further, experienced attorneys generally have a much better knowledge and understanding of the rules governing these loans, and can properly advise you as to the ramifications of any proposed loan modification the lender may offer. Did you know, for example, that many lender's loan modification agreements contain a waiver of any claims against the lender - past, present or future? Legally, not even a real estate licensee can give you legal advice about the proposed modification.

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Re: Foreclosures

Yes. They will need to be given a power of attorney to do so.

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