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At the request of the Federal Trade Commission, a U.S. district court has ordered two companies to stop falsely advertising that they are part of a government-endorsed mortgage assistance network and that they successfully modify mortgages for almost all of their clients or else give refunds. In fact, the FTC alleges that the defendants are not affiliated with the legitimate HOPE NOW Alliance mortgage assistance network, often divert one month’s mortgage payment as a fee from distressed homeowners, fail to help them modify their mortgages, and then deny them refunds.

“With many consumers desperate for relief and afraid they might lose their homes in these difficult economic times, some unscrupulous individuals prey on these fears for their own financial gain,” said FTC Chairman Jon Leibowitz. “The New Hope and Hope Now scammers have given consumers false hope under the guise of the government-endorsed HOPE NOW Alliance. We won’t hesitate to take action against these types of con artists now and in the future.”

According to the Commission, the defendants advertised, marketed, and sold mortgage loan modification services to consumers nationwide using Web sites including and The FTC charged the defendants with violating federal law by misrepresenting that they could obtain mortgage loan modifications for consumers in all or virtually all cases and that they would refund consumers’ money if they did not.

The FTC also charged the defendants with making false claims that they are affiliated with, or part of, the HOPE NOW Alliance, a non-profit organization that is a broad-based coalition of credit and home ownership counselors, lenders, investors, mortgage market participants, and trade associations. The HOPE NOW Alliance offers free assistance to homeowners who may not be able to pay their mortgages and need help working with their mortgage company or loan services. Seeking to capitalize on its name, the defendants called their firms New Hope Modifications and Hope Now Modifications, and used telephone numbers that included “HOPE,” to mimic the real HOPE NOW Alliance hotline which is 888-995-HOPE.

Both defendants’ Web sites contain statements designed to induce consumers to buy their services. For example, the New Hope defendants’ Web sites represent that “Loss Mitigation” is “The Fast and Easy Way To save your home,” and that, “Our experience with the loss mitigation departments of major mortgage companies and servicers gives you the advantage needed to secure a plan you can live with.” The Hope Now defendants’ Web site claims that Hope Now “can help you save your credit and your home, often within 60 to 90 days.” Other claims include, “We STOP FORECLOSURE In Its Tracks!**”

According to the FTC, when consumers call the New Hope or Hope Now toll-free numbers, the defendants’ telemarketers promise them that they can help modify their mortgage loans and prevent foreclosure. Consumers are then told that they first must pay an up-front fee, referred to as a “mitigation escrow fee” before the defendants begin working with them.

The complaints also allege the defendants tell consumers they can receive a full refund if they are not satisfied with the defendants’ services. The complaints state that, in many cases, after consumers have paid the up-front fees, the defendants fail to return their phone calls to provide them with updates about the status of their purported communications with the consumers’ lenders or misrepresent that negotiations are proceeding smoothly. In most instances, the defendants fail to obtain mortgage loan modifications, and in many instances consumers find out later from their lenders that they have not even been contacted by the defendants. Finally, the complaints state that consumers who complain about the lack of service often find they cannot get a refund for the substantial up-front fee they paid.

The complaints and temporary restraining orders announced today were entered against: 1) Hope Now Modifications, LLC, Hope Now Financial Services Corp., also doing business as (dba) Hope Now Modifications, and their principals, Nick Puglia and Salvatore Puglia; and 2) New Hope Property LLC, also dba New Hope Modifications LLC, and its principals, Brian Mammoccio and Donna Fisher. The FTC continues to seek a permanent halt to the defendants’ illegal conduct.

The Commission vote approving each complaint was 4-0. Both complaints were filed on March 17, 2009 in the U.S. District Court for the District of New Jersey. The court entered the temporary restraining orders and related asset freezes on March 19, 2009. The FTC brought the complaints with the invaluable assistance of the HOPE NOW Alliance and the Attorney General of New Jersey.

NOTE: The Commission authorizes the filing of complaints when it has “reason to believe” that the law has been or is being violated, and it appears to the Commission that a proceeding is in the public interest. The complaints are not a finding or ruling that the defendants actually have violated the law.

Copies of the complaints are available from the FTC’s Web site at and also from the FTC’s Consumer Response Center, Room 130, 600 Pennsylvania Avenue, N.W., Washington, D.C. 20580. The Federal Trade Commission works for consumers to prevent fraudulent, deceptive, and unfair business practices and to provide information to help spot, stop, and avoid them. To file a complaint in English or Spanish, visit the FTC’s online Complaint Assistant or call 1-877-FTC-HELP (1-877-382-4357). The FTC enters complaints into Consumer Sentinel, a secure, online database available to more than 1,500 civil and criminal law enforcement agencies in the U.S. and abroad. The FTC’s Web site provides free information on a variety of consumer topics.

(FTC File Nos. 092-3068 and 092-3079; FTC v. New Hope Property LLC, et al., Case No. 1:09-cv-01203-JBS-JS (D.N.J.); FTC v. Hope Now Modifications LLC, et al., Case No. 1:09-cv-01204-JBS-JS (D.N.J.))

Contact Information

Mitchell J. Katz
Office of Public Affairs
Gregory A. Ashe
Bureau of Consumer Protection