State and federal authorities may have cracked down on unscrupulous mortgage lenders to avoid a repeat of the housing market meltdown, but there are still plenty of companies that are eager to dupe people into taking out bad loans.
Exhibit A: Companies sending official-looking letters that seem to say you have to take action or else your home loan will be in trouble. The letters, of course, aren't from a government agency. They're from some business trying to get you to refinance.
And now an Irvine company called Network Capital Funding is taking the questionable sales pitch up a notch. It's sending out a letter that claims to be the "second notice" a homeowner is receiving, even though there never was a first notice, and it's doing its best to masquerade as a money-saving federal program.
"Due to recent revisions of the Home Affordable Refinance Program, your Fannie Mae loan has been flagged for internal review," the letter warns. "Prior attempts to notify you have not been successful."
The letter includes a "case reference number" and instructions for recipients to go to a website where they'll be able to "confirm eligibility" for a new loan with an annual percentage rate of just 2.6%.
You have to find your way to the fine print on the back of the letter to find out that Network Capital Funding isn't affiliated with Fannie Mae or any other government agency.
That's also where you'll discover that securing a low-interest loan is contingent on having a credit score of at least 740, which would allow you to refinance at a competitive rate with any reputable financial institution, although probably not below 3%.
"The actual APR, interest rate and payments may be higher based on your actual situation," the fine print admits. Oh, and you'll have to pony up $2,333 in "lender's fees."
Paul Myers, 60, of Los Angeles, recently received one of Network Capital Funding's letters.
"At first I was scared when I looked at it," he told me. "I didn't want any bad news about my home. Then I realized that it was really an ad for a screwy loan."
This particular racket preys on people who don't pay close attention to their correspondence. Their first reaction might be to contact the company, and before they know it, they're on the phone with a salesperson.
I spoke briefly with Jim Pate, Network Capital Funding's director of sales. If anyone was in a position to explain the company's sales efforts, it was him.
However, Pate declined to discuss the contents or format of the letter.
I asked how Network Capital Funding knows that a homeowner's Fannie Mae mortgage has been flagged for internal review.
"I'm not quite sure how they determine that," Pate answered.
I asked for the name of the privately held company's chief executive. Pate declined to say.
For the record, the CEO is Tri Nguyen, who didn't return my calls.
Also for the record, the Better Business Bureau of the Southland gives Network Capital Funding a rating of "A+," even though the company has been the subject of 29 complaints to the bureau over the last three years.
Network Capital Funding is an accredited member of the bureau, which means it pays hundreds of dollars to the organization in annual fees.
Kim Burge, vice president of the Better Business Bureau of the Southland, said there's no correlation between a company's rating and its accreditation status. But she said the letter from Network Capital Funding is "a concern" and that she plans to follow up with the company.
All I know is that if letters like that can still get you an A+ from the bureau, I'd hate to see what a company has to do to earn an F.
Target gets it. The company has told its pharmacists that they'll no longer be graded on how many patients they sign up for automatic refills.
Pharmacists at Target, CVS, Walgreens and Rite Aid have said they feel enormous pressure to meet company quotas or face the consequences. Failure to hit quotas could result in loss of raises or bonuses or even reassignment to another location.
The U.S. Department of Justice, the Department of Health and Human Services and regulators in California and New Jersey are investigating to see whether pharmacies have been refilling prescriptions and enrolling people in automatic-refill programs without their approval.
While pharmacists at most major drugstore chains have told me they've been instructed to be less aggressive in refilling prescriptions, only Target has officially said it will no longer monitor how many people are being signed up for automatic refills.
"We made the decision to remove the AutoRefill metric from our pharmacies' reporting tools," acknowledged Jessica Deede, a Target spokeswoman. "The change took effect this month."
Props to the company for taking the heat off their pharmacists and allowing them to concentrate on meeting patient needs.
Promoting automatic refills can be good for patients and good for business. But it shouldn't be a pharmacist's chief concern. Nor should it be a factor in determining a pharmacist's compensation.
If you've had an experience with unwanted refills, contact the California Board of Pharmacy at http://www.pharmacy.ca.gov. Or you can call the Department of Health and Human Services at (800) HHS-TIPS.
One last thing
In response to all the emails about Friday's column on my getting bitten by our cat and being hospitalized for a week, yes, we're keeping the dang critter.
But if anyone knows of a good exorcist, drop me a line.