August 21, 2017

Beware of Scam “Forensic” Loan Auditors/Companies

Ok, here we go go again… now the scams have hit the loan auditing industry. Most of these fakers are ex-mortgage brokers who didn’t make it in the mortgage industry and are now looking for a new way to make money. There are a few good auditors out there who have really put in the time, effort and research to actually know the laws and know how to properly state the elements of these violations in a manner that can actually help a homeowner in a foreclosure matter (and can help an attorney bring these violations as affirmative defenses or counterclaims in a foreclosure case).

 TILA or supposed “Forensic” Audits that use standardized check-off lists without providing a mathematical determination of the TILA Disclosure Statement and amounts are NOT Forensic Audits.  A check-off list  or automated/software-driven TILA Audit describing potential violations as “Serious,” or “Moderate” is incompetent and useless.  A Forensic TILA Audit must provide accurate TILA; Regulation Z citations, case law precendent, as well as actual computation of all settlement service fees properly allocated in the TILA Disclosure Statement or the Audit will NOT withstand scrutiny by legal authorities.  Do not be fooled by imitations using standardized check-off lists.

There is absolutely nothing “forensic” about plugging loan data into some software and having it spit out a report. But that is exactly what most of these fakers are doing and they are charging anywhere from $395 to $995 based on what I have seen so far.

If the loan audit will NOT stand up to legal scrutiny then you have wasted your money and someone has scammed you into believing you were paying for something that would help you. Why would  you pay for a loan audit that would not stand up to legal scrutiny?

The software driven report serves a limited purpose and I use a popular banking compliance software for my audits as well but this software-driven report is only a small piece of my actual audit and findings report. A true forensic auditor examines every document relevant to the loan and looks at signatures, dates, parties on the documents, who provided those disclosures or documents and also obtains the story from the client because every loan is a story. It involved people and usually quite a bit of communication between the borrower and the indispensable parties to the transaction.

I have myself setup for Google Alerts on a number of search terms so I go to these other websites pretty frequently. I also get clients who have dealt with some of these fraudsters and now want my help to clean up the mess and the wasted money. Hopefully this post will cause those who read it to really do some good checking before they part with hard-earned money.

Bottom line is to make sure you follow your gut. Do your homework, ask questions, ask for references. A good auditor will most likely have attorneys they work for and consult for.

Feel free to contact me if you have any other questions on this topic or would like a sample of my audit reports. You’ll be able to see the true forensic nature of a good audit vs. these computer-generated reports.

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