City Of Los Angeles Votes To Ban All Upfront Fees Charged By Loan Modification Firms

In Los Angeles, California, the Los Angeles Times reports:

• The Los Angeles City Council voted Tuesday to make it illegal for so-called mortgage consultants to charge an upfront fee for services when helping distressed homeowners try to modify their payments. Mayor Antonio Villaraigosa touted the law as the first of its kind in the nation and said it was a tool to "help residents keep a roof over their heads."

• State law already prohibits mortgage consultants from demanding upfront fees from homeowners who are in default, the first stage of foreclosure. The new Los Angeles law, which the council approved unanimously, will apply those protections to all homeowners.

For more, see L.A. council votes to tighten rules on mortgage consultants (A new city ordinance will bar the consultants from demanding upfront fees from any homeowner -- not just those in default, who are protected under state law).