ABS Business Solutions, Inc. Mortgage Auditing Service Agreement
Part I A. Parties to the Agreement ABS Business Solutions, Inc. (hereafter "ABS"), a California Corporation, and ______________________________________________________________ (hereafter "Client"), whose mailing address is: ______________________________________________________________ and whose property address is: ______________________________________________________________ hereby enter into this agreement, in which ABS will provide mortgage loan audit services to Client as set forth below. B. General Statement of What ABS Will Do For Client ABS will arrange for a thorough examination of Client's existing residential mortgage. This examination may reveal fraud, deceit, unfair lending practices, misrepresentation, deceptive predatory lending practices, violations of the Truth In Lending Act ("TILA"), violations of the Real Estate Settlement Procedures Act ("RESPA"), Home Ownership and Equity Protection Act of 1994 ("HOEPA") and violations of Regulation X and Z. The examination may also expose irregularities in loan terms, failure to completely disclose all loan terms, failure to disclose pre-payment terms, and more. If a lawsuit is required, such lawsuit will be handled by Bethune & Associates, a law firm which works in tandem with ABS and which has multi-state capability and experience in dealing with debtor-creditor matters. Client agrees to have Client's file forwarded to, and to retain, Bethune & Associates.
1 Rev. (5-1-09)
ABS Business Solutions, Inc. Mortgage Auditing Service Agreement C. The Report To Client A report outlining possible deceptive lending practices, as well as proposed solutions, will be sent to Client's lender and its servicer (collectively "lender" herein) in accordance with RESPA § 2605 in the form of a "qualified written request" ("QWR"). The QWR is a detailed complaint to Client's lender pointing out improper lending practices. ABS will arrange for the QWR within 20 business days of receiving all of Client's mortgage and loan documents as required by ABS to complete the audit. (Please note that if Client pays by personal check this process will be delayed for an additional 10 business days.) ABS will send a copy of the QWR, as well as any correspondence to or from the lender, to Client. The QWR to the lender will be based on the documents Client provides to ABS. ABS will inform the lender of all mortgage related violations found in the document review; and ABS or Bethune & Associates will attempt to get a settlement from the lender. Part II Required Documents The following documents are required in order for ABS to arrange for the QWR: • Good Faith Estimate • Federal Truth in Lending Act Disclosure Statement • Loan Application [Form 1003] • Most recent monthly loan statement from lender • Mortgage note plus any riders or attachments • Client tax returns (the pages showing the adjusted gross income) for the 2 years prior to closing of the subject loan • Final Settlement Statement [HUD-1] • Notarized Power of Attorney Part III Client Responsibilities Client agrees to: • Provide all documents that relate to Client's mortgage (including, but not limited to, those listed in Part II above) to ABS. If Client has difficulty obtaining them, Client will ask ABS for assistance. • Sign all documents required by Bethune & Associates if a lawsuit is necessary. • Sign all documents relevant to each step of the audit procedure. • Keep ABS and its designated attorney advised of any information or developments which may come to Client's attention regarding the mortgage. • Send to ABS any correspondence or other documents sent to Client from the lender.
2 Rev. (5-1-09)
ABS Business Solutions, Inc. Mortgage Auditing Service Agreement • • • • Not propose or accept any settlement from lender without ABS' prior written approval. Assist ABS promptly when requested. Pay the fees noted in Part IV below and all additional compensation noted in Part V below. Forward immediately any correspondence received from lender or lender's agent to: ABS Business Solutions, Inc. 249 S. Highway 101, Suite 210, Solana Beach, CA 92075; or via fax to (760) 724-6202.
Client understands he is to keep in contact with ABS. Many issues and questions may arise and ABS will need Client's input in order to perform a thorough audit. Client's failure to fulfill any of the obligations noted above or below will constitute a breach of this agreement and may cause Client to lose any money paid to ABS and to become liable to ABS for fees and additional compensation. Part IV Fees Client Agrees to pay ABS $2995 to initiate and monitor an audit of one mortgage (or $3995 for two mortgages). Fees for audits of more than two mortgages will be negotiated on a case-bycase basis. These fees will be refunded in full if (but only if) the audit discloses no violations of relevant law. Client agrees to pay the following fee at this time: $________. Client initials: ___ Part V Additional Compensation A. In addition to the fees noted above, ABS will be entitled to 30 % of Client's net recovery. If the recovery results from only ABS’ efforts, the 30% will be calculated on the full recovery. If the recovery results from ABS’ and Bethune & Associates’ efforts, the 30% will be calculated on the balance left after Bethune & Associates has deducted its contingency fees as more fully explained in “B” below. Client agrees that Bethune & Associates will send such net recovery directly to ABS. ABS will then deduct its portion and forward the balance to Client.
3 Rev. (5-1-09)
ABS Business Solutions, Inc. Mortgage Auditing Service Agreement B. If Client’s recovery is attained through the efforts of Bethune & Associates, the recovery is treated in one of the following ways: 1. Bethune & Associates receives a contingency fee of 10% of total cash award in the event of a settlement without litigation. The net remaining balance of the recovery will be distributed by Bethune & Associates to ABS for disbursement. ABS will forward 70% to the client and 30% will be retained by ABS. OR 2. If litigation becomes necessary, Bethune & Associates receives a contingency fee of 27.5%. The net remaining balance of the recovery will be distributed by Bethune & Associates to ABS for disbursement. ABS will forward 70% to the client and 30% will be retained by ABS. For example: If Bethune & Associates litigates and recovers $100,000, the distributions would be as follows: Bethune & Associates receives $27,500.00. Client receives $50,750.00 ABS receives $21,750.00
C. In addition to the above fees and compensation, Client agrees to pay ABS 3% of the value of any reduction of Client's mortgage principal when such reduction is due to ABS' or Bethune & Associates' efforts. For example, if the lender agrees to reduce Client's loan principal by $200,000, Client will pay $6000 to ABS for such reduction. D. Client agrees that Client will not propose or accept any settlement from lender (or anyone on behalf of lender) without ABS' specific written approval; and that if Client does so settle without ABS' written approval, Client will pay such fees and additional compensation [defined in Parts IV and V] to ABS as ABS would have been entitled to had the settlement been obtained through the efforts of ABS and Bethune & Associates.
4 Rev. (5-1-09)
ABS Business Solutions, Inc. Mortgage Auditing Service Agreement Part VI Obligations and Disclaimers Nothing in this agreement and nothing in ABS' statements to Client constitutes a promise or guarantee about the outcome of ABS' or Bethune & Associates' efforts. ABS makes no such promises or guarantees. ABS' sole obligation is to find and disclose TILA, RESPA, Regulations X and Z and HOEPA violations in Client's mortgage and loan documents, to bring these to the attention of the lender via a QWR, to negotiate with lender, and, if necessary, to forward the findings of violations to counsel who will file a lawsuit if, in such counsel's discretion, he believes such suit has a reasonable chance of success. While ABS will pledge its best efforts in resolving Client's matter, ABS cannot predict the outcome of Client's matter, as it is inherently unpredictable. ABS is not a law firm and its affiliates are not attorneys. It does not render legal advice. Client understands that the actions taken by ABS and Bethune & Associates will not stop a foreclosure or the processes leading to foreclosure. Client understands that the general time frame involved is as follows: • Within 20 business days after lender receives the QWR, it must provide a written acknowledgement. • Within 60 days after lender receives the QWR, lender must make any appropriate corrections to your account and must provide a written clarification regarding your dispute. • Unless the lender proposes a settlement at that point acceptable to you and ABS, Bethune and Associates will, if it deems the case meritorious, commence litigation proceedings, which may take up to a year or possibly longer to resolve, whether by trial or settlement. Client understands that neither ABS nor Bethune & Associates control these time frames, as they cannot ensure that lender complies with them, and litigation time frames are in the control of the Court. ABS' services do not include independent or related matters that may arise including, but not limited to, claims for property damage, disputes with escrow or title companies, or claims for reimbursement by an insurance company. Further, ABS is not a foreclosure consultant as defined in California Civil Code §2945.1 and in any equivalent law of other states, and does not offer or provide any of the services listed in California Civil Code §2945.1 (a).
5 Rev. (5-1-09)
ABS Business Solutions, Inc. Mortgage Auditing Service Agreement Part VII Entire Agreement The written terms in this agreement are the entire agreement. Nothing said by ABS, its affiliates, or anyone associated with ABS is effective unless it is also explicitly written in this agreement. No terms may be added, changed, or modified unless done in a writing signed by an officer of ABS and Client. I have read the above terms and conditions. I understand them, and hereby agree to them. I have had an opportunity to consult counsel if I wish.
____________________________ Client ____________________________ Client ____________________________ ABS Representative ____________________________ Date
___________________/_____________________ Client telephone # e-mail address _________________/_______________________ Client telephone # e-mail address
6 Rev. (5-1-09)