Foreclosure scam alert: Florida sues FHA All Day

By Aaron Gilchrist - bio | email
Posted by Terry Alexander - email

HENRICO, VA (WWBT) – A 12 On Your Side Alert tonight for anyone who's having trouble making their mortgage payment. There are a lot of big promises out there -- followed by disappearing money. So, how do you protect yourself and your money?

A Florida company is at the center of lawsuit right now after collecting money from families all across the country. An elderly Henrico couple spent thousands of dollars they didn't have and got absolutely nothing in return.

The Ridleys worked long and hard years ago to be able to enjoy life's little comforts today. That includes their home in western Henrico. A home they love and would do anything to keep.

"We were on social security and pension at the time, struggling already with the bills that we had and thought -- this was our chance!" said Ercelle Ridley.

Mrs. Ridley got a phone call back in February from someone offering a home loan modification. She liked the idea of being able to lower her bills, so she listened.

"He said he was going to get an attorney to work with me... And later he told me what the attorney fee was," she said.

After more details from "FHA All Day" arrived in the mail, it seemed like a good plan and the Ridley's Fed Ex'ed their $2,000. A few more phone calls, some emails and then...

"Then as time went on, he sort of dropped off the scene. Even his telephone number changed," said Ridley.

The Ridleys began to think they'd been swindled. And they may not be alone. The Florida Attorney General filed suit against FHA All and three other related companies accusing them of foreclosure rescue fraud.

The suit alleges they charged upfront fees for loan modification services as high as $5,000, collected up to a million dollars in fees every month and claimed to have an attorney on staff. Investigators believe no attorneys were working on loan modifications when the suit was filed.

Today, FHA All simply says the company isn't taking new applications. The Florida Attorney General says it has more than 300 complaints about the owner and his related companies on file.

"Doing everybody all over the country, how could they live with themselves?"

Mrs. Ridley filed her own complaint and now knows it's illegal for a company to collect money for home foreclosure help before any work is done. The best option is to look to government-approved housing counselors on your own.

"I mean he talked to me like we were old friends or something. Lord, I didn't think that that would happen to me. But it did," Ridley said.

The Florida Attorney General is seeking restitution on behalf of anybody who may have been victimized by the company. You can file a complaint and affidavit on the Florida Attorney General's website by clicking here.

The Florida attorney general reports assets for "FHA All Day" and all related companies are frozen. The company's also prohibited from collecting any further up-front fees, and the court has appointed a receiver. We tried to reach "FHA All Day" by phone. A recording indicated it is not accepting calls.

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