Company Promises Lower Mortgage Payments
Lands Clients In Foreclosure
A CBS Atlanta exclusive investigation is exposing a local company victimizing people who are trying to lower their home and car loans. We've spoken with dozens of families who say they've been devastated by one man whose profiting off their misfortune.
Fred Lee, an agent with Matrix Capital, has been served with a cease and desist order in Georgia and he is under investigation by the Dekalb County Police. But you'd never know it. His business is booming and the number of victims is growing.
"It could be any minute, any first Tuesday. Every first Tuesday I am waiting to see if my name is one the foreclosure list," Val Littleton told us.
Littleton is just one of the people living the same nightmare we were told time and time again.
"He said, ‘I got you, Val I got you.’ He got me in foreclosure," she warned.
"He should be punished for the wrong things that he has done to people," James McClendon agreed.
"If it happens, I lose my house, I have nowhere to go," Yvette Smith told us.
Lee is a self-proclaimed multi-millionaire who lives in a 6 million dollar home in one of Atlanta's most exclusive communities; he has several expensive cars, and a luxurious life almost anyone would envy. In 2006 he says he took home 11 million dollars.
But some people warn his lifestyle has been fed off the misery of others…
"I'm in foreclosure," Yvette Smith said.
Lee and his company, Matrix Capital, sell people the promise of a loan modification for $15-hundred dollars up front. He says he'll get you a lower interest rate, and while he's negotiating, you don't have to make a payment. You can live mortgage free. And people have believed him.
He holds packed meetings across the southeast, luring in new clients.
"Doesn't it make sense go into modification and have no payments during that process?" Lee said in his seminar.
It sounds good, but there's the catch. What he doesn't tell clients is as part of his process, after you don't make the payments, the bank may foreclose on your home. And you may have to file for bankruptcy to save it.
Littleton put her home loan and two car loans in Lee's hands looking for a better rate. She had no idea what she was in store for. Her house is now in foreclosure and she had to hide her car to keep it from being repossessed.
"I said ‘Fred, you knew we wouldn't have done it. And you're pockets wouldn't have been $200,000 richer each week,’" Littleton continued.
So we approached Lee to ask the tough questions about his loan modification process.
"So you financial advice is don't make the payment?" Investigative Reporter Wendy Saltzman asked.
"No stop, stop, stop," Lee said.
"And then the banks threaten to foreclose on your place, and that's how you get them to modify your loan?" Saltzman questioned.
"Ma'am. me and you both know what I just said," Lee Replied. "Studies have shown that most banks won't start the modification process until you are 2 months behind."
But his victims say they were never told their homes might go into foreclosure. And no one we spoke with had a successful modification through Lee.
"You are going to get all the collections, you are going to get all the ugly calls," Lee told us. "You might even get defaulted on."
The police are also now investigating Lee.
We'll tell you more about their investigation Friday night at 11.
