Federal Mortgage LawsQuestion 22 of 400
Under the Mortgage Assistance Relief Services (MARS) rule (Regulation N), a company offering loan modification services to distressed homeowners is generally prohibited from:
a.Advertising its services online
b.Contacting the homeowner's lender
c.Charging any fee at any time
d.Collecting any fee before the consumer receives and accepts a written offer from the lender or servicer
Explanation
The MARS rule (Regulation N) bars mortgage assistance relief providers from collecting advance fees; a fee may be charged only after the consumer receives and agrees to a written mortgage-relief offer from the lender or servicer. Advertising and contacting the lender are not themselves prohibited, and fees are not banned entirely, only advance fees. The rule targets upfront-fee foreclosure-rescue scams.
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