Company promised to save homes from foreclosure, pocketed money instead

Raleigh, NC - May 2, 2008 - A Lenoir County company that targeted distressed homeowners with false offers to help save them from foreclosure has been ordered to stop taking consumers’ money, Attorney General Roy Cooper said today.

“Times are tough and many people are looking for help to save their home,” said Cooper. “We won’t hesitate to go after outfits that are trying to make a fast buck off of families in trouble.”

This week, Superior Court Judge Orlando Hudson ordered Alphin Marketing Group, Inc., also doing business as Alphin Group, Inc., and owner and president Russell E. Alphin of Lenior County to cease operating while Cooper’s suit against them goes forward. Cooper alleges that the company and its owner broke state laws and he is seeking to permanently bar them from offering foreclosure assistance and debt adjusting services in North Carolina. Cooper is also asking the court to cancel the company’s contracts with consumers and pay refunds.

As alleged in the complaint, Alphin Group combed through public courthouse records for the names of homeowners who were facing foreclosure, then sent them a mailing claiming it could help them avoid foreclosure and in most cases “drastically reduce or eliminate” late mortgage payments.

Cooper contends that Alphin Group claimed it had special expertise and a 95 percent success rate in saving consumers’ homes from foreclosure. The company collected its fee upfront, typically one month’s mortgage payment, and promised to negotiate with lenders on the homeowner’s behalf. The company also told homeowners not to talk to their mortgage company, urging them to let its so-called experts handle all communications. In reality, Alphin Group did little or nothing to help these consumers.

Five consumers have filed complaints with the Attorney General’s Office about Alphin Group. One homeowner said that she called the Alphin Group while waiting for approval from her lender for a workout agreement on her mortgage. An Alphin Group representative met with her and told her to deposit $1,100 into the company’s bank account, supposedly to prove to the lender that she had funds to pay the mortgage. After several months of unanswered calls and empty promises from Alphin Group, the homeowner learned that the lender approved the workout agreement originally negotiated by her bankruptcy attorney. The lender had never heard from Alphin Group nor received any of the money that the homeowner had paid.

“Don’t agree to pay any money upfront for help with foreclosure,” said Cooper. “Call North Carolina’s free hotline instead.”

North Carolinians who are facing foreclosure can call the HOPE Hotline toll-free at 888-995-HOPE 24 hours a day, seven days a week to receive free counseling on options to avoid foreclosure.

 

 

 

 

USGBC - U.S. Green Building Council

HUD - U.S. Department of Housing and Urban Development

NAR - National Association of REALTOR

RealtyTrac

FHFA - Federal Housing Finance Agency

Freddie Mac

MBA - Mortgage Bankers Association