Amerifund Smart Homes, Inc.

Effective October, 2009 in California, it is illegal to collect any fees, regardless of the form, for negotiating or attempting to negotiate a loan modification for a residential mortgage. All modification services must be fully completed before any money can be collected. It is also illegal to divide fees or services into components for the purpose of avoiding this law.

HUD approved housing counseling agencies are exempt from this law. For businesses outside of California, please check with the agency that regulates this industry.

Our experience with debt negotiating companies is that they attract heavily indebted clients by claiming to be able to settle the clients’ debts for far less than the amount owed and to stop creditors’ calls. They often claim also that their services are more effective than those provided by credit counseling services.~~These companies usually instruct their clients to stop paying their creditors. Some companies direct them to make their payments to the debt negotiation company instead and promise when the company has accumulated enough to offer a cash settlement to one or more creditors (which can take as long as two or three years) to pay off the debt. The debtor must pay fees to the service during the time the payments are accumulating. ~~Other companies simply collect the fees and advise debtors to save their money to pay their creditors themselves. California law limits the amount of fees debt negotiators can charge you but by not collecting the money and distributing it to your creditors for you companies can remove themselves from the limiting statutes and charge whatever they wish. What they are supposed to do for you while you’re saving up your money is to contact your creditors and inform them that they’re working with you negotiate the amount to settle your debt and ask them stop contacting you. ~~However the company operates though complainants allege that creditors continue to harass them fees and interest continue to accumulate the companies do not contact the creditors creditors increase their collection efforts and sometimes sue for payment the debtor’s credit is ruined and they end up worse than before they contacted the service. ~~Debtors may not realize that if their creditors do accept a negotiated settlement the amount forgiven constitutes taxable income.