Zombie Mortgage Debt Relief for Homeowners

New York Attorney General Letitia James recently secured more than $480,000 and additional debt relief for New York homeowners from a group of debt buyers who attempted to collect expired mortgage payments from homeowners facing foreclosure. An investigation by the Office of the Attorney General (OAG) found that a group of companies, including BCMB1 Trust; First Age, LLC; NS194, LLC; Second Start, LLC; Southern MBA Trust, and their affiliates, bought thousands of defaulted mortgage loans throughout the state, most of which originated in the years leading up to the 2008 financial crisis. Many of these loans were second mortgages that had long gone unpaid because borrowers had modified their primary mortgages during the financial crisis and lenders had stopped trying to collect payments on them. The OAG’s investigation found that the debt buyers violated New York laws by filing foreclosure lawsuits with demands to repay debt that was no longer legally collectable. As a result of OAG’s investigation, the companies will pay more than $480,000 in penalties and restitution to homeowners and must drop all demands for expired mortgage payments in any ongoing foreclosure case.

To learn more or to file a claim, visit the New York Attorney General’s website.