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North Carolina Shuts Down Mortgage "Rescue" Operation

August 24, 2006

Mortgage "Rescuers" • California Shuts Down Mortgage Scam Artists • FTC Takes On Mortgage 'Rescue' Operations • Illinois Uses New Law to Sue Mortgage Rescue Company • Washington State Settles with Mortgage "Rescuers" • Scams and Foreclosures On the Rise • Illinois Sues Mortgage "Rescue" Companies • Mortgage Crisis? Act Now to Avoid Foreclosure • North Carolina Shuts Down Mortgage "Rescue" Operation • Illinois Shuts Down Mortgage "Rescue" Scam • Indiana Fines Mortgage "Rescue" Firm • Illinois Sues Another Mortgage Foreclosure "Rescuer" • Missouri Sues Foreclosure "Rescue" Business • Illinois Launches Offensive Against Foreclosure "Rescuers" • New York Takes On Predatory Real Estate Scams • Texas Halts Bogus Foreclosure Rescue Operation

A Charlotte company that targeted distressed homeowners with offers to help save them from foreclosure has been ordered to stop taking consumers' money. Attorney General Roy Cooper said its another example of scammers taking advantage of people in need.

"This outfit took money from desperate homeowners, promised to help them avoid foreclosure and then left them in the lurch," said Cooper. "Foreclosure assistance scams kick consumers who are already down, so we're working to shut down the scammers."

Wake County Superior Court Judge Gary Trawick today ordered Mortgage Assistance of the Carolinas, Inc., its predecessor, Carolina Mortgage Relief, Inc., and owner and president Alan Steve Seabolt of Charlotte to cease operating while Cooper's suit against them goes forward. Cooper alleges that both companies and their owner broke state laws against unfair business practices and debt adjusting.

Cooper is seeking to permanently prohibit Seabolt and his companies from continuing their illegal foreclosure assistance services and to require them to cancel all contracts with consumers and pay refunds and penalties.

As alleged in the complaint, Mortgage Assistance of the Carolinas, its predecessor and Seabolt combed courthouse records for the names of homeowners who were facing foreclosure, then sent them a direct mail solicitation claiming they could help desperate homeowners avoid foreclosure. Many of these homeowners were having trouble keeping up with monthly mortgage payments due to a lay off, illness or death in their family.

When homeowners responded to the mailings, Cooper contends that Mortgage Assistance of the Carolina claimed it had special expertise and a high success rate in saving consumers' homes from foreclosure.

The company collected its fee upfront, typically one month's mortgage payment, promising to negotiate with mortgage lenders on the homeowner's behalf. The companies also forbid homeowners to talk to their mortgage company, urging them to let its so-called experts handle all communications with the lenders.

In reality, Cooper charges, Mortgage Assistance of the Carolinas did little or nothing to help these consumers. Consumers who complained to Cooper's office said they rarely heard from the company once they paid their money. A total of 7 consumers have filed complaints with the Attorney General's Office about Mortgage Assistance of the Carolinas and Carolina Mortgage Relief.

"Not only did these consumers lose money when they could least afford to," Cooper said, "They also lost precious time they could've spent negotiating with their lender on their own and possibly avoiding foreclosure."

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