Swanson sues two firms over mortgage scams

Minnesota Attorney General Lori Swanson filed lawsuits Wednesday against two out-of-state companies purporting to help homeowners facing foreclosure.

The lawsuit claims Balanced Legal Group of California and Home Protection Coalition of Wyoming charged homeowners several thousand dollars in upfront fees, which is illegal under Minnesota law.

Attorney General Swanson says ironically, both companies preyed on consumers' fear of scams.

"In one case, a California law firm is saying, 'Hey, you gotta hire an attorney, there are a lot of scams out there, don't fall victim to one of those scams, instead hire us,'" said Swanson. "The other company is literally taking the logo of a federally funded program designed to warn people about modification scams, and duping people into paying thousands of dollars in fees that are illegal under Minnesota law."

Minnesota has filed nearly 20 lawsuits against mortgage assistance companies, all but one from out of state.

Neither company has responded to MPR's request for comment.