UNDERSTANDING MARS – A Webinar on the FTC’s Final Rule With Compliance Attorney, Julie Greenfield


Understanding MARS

The FTC’S Final Rule for Mortgage Assistance Relief Providers


TIME:   9:30 AM to 11:30 AM (Including time for Q&A.)

Formally, it’s called Title 16 – Code of Federal Regulations, Part 322, for Mortgage Assistance Relief Services.  Informally, it’s called MARS.  And whether you are a lawyer, a mortgage broker, a real estate agent, or a company who contracts to provide services to a MARS provider… if you are engaged in helping homeowners avoid foreclosure in any way… ANYWHERE IN THE U.S. this rule will have a very real and major impact on how you do business.

This new federal rule applies to all types of mortgage assistance relief assistance services, including anything having to do with loan modifications AND/OR short sales or Deed-in-Lieu settlements. Simply put, it’s a rule you don’t want to break: Penalties for non-compliance with the FTC’s new MARS rule are $11,000 A DAY.

That’s why Mandelman Matters is offering a Webinar, to present a comprehensive examination of the FTC’s new rule and its ramifications to the legal profession, along with mortgage brokers and real estate agents.  The rule goes into effect in full on January 30, 2011, although a large part of it takes effect as of December 31st, 2010, so there’s no time to waste getting your arms around what is and isn’t permitted gong forward.

Compliance attorney, Julie Greenfield, who has over 30 years experience in mortgage banking having been in-house counsel for two Lehman Bros. companies and General Counsel at New Century Mortgage and Option One Mortgage, along with Martin Andelman of Mandelman Matters and The Niche Report, who has written close to 400 articles on the foreclosure crisis and is an outspoken advocate for homeowners facing foreclosure, will lead attendees through an in-depth yet easy to understand presentation of the new rule.  (See their bios below.)

Among other things, by attending this Webinar you’ll learn:

The Definition of a MARS Provider:

  • Under what circumstances are real estate brokers & agents subject to the FTC MARS Final Rule, and what are the exemptions that exist within the new MARS rule?
  • Are companies providing analyses of foreclosure and securitization documentation also subject to the FTC MARS Final Rule?
  • What record keeping requirements apply, and to whom do they apply under the new rule?
  • What are the Prohibited Representations and Misrepresentations (16 CFR Section 322.3)?
  • What are the penalties for being deemed noncompliant with the MARS rule?

Attorney Exemption:

  • What are the specific criteria for exempting attorneys from the FTC MARS Final Rule?
  • What is considered the “practice of law” with regard to Mortgage Loan Modifications?
  • Are law firms considered “attorneys” for purposes of applicability of the FTC Final Rule?
  • Can the Attorney Exemption be forfeited, and how?  What to do to protect your practice?
  • How do the state laws apply to attorneys as MARS providers?
  • Communicating with Consumers regarding the new MARS rule.  What are the Required Disclosures in Consumer-Specific Commercial Communications?
  • What specific disclosures are required regarding advising consumers about the failure to make mortgage payments?

Contractors and Agents of MARS Providers:

  • Are contractors and agents providing processing and/or marketing services to exempt attorneys subject to the Final Rule?
  • What are the obligations of such contractors under the Final Rule?
  • Can contractors and agents receive compensation from another MARS Provider prior to receipt of a Modification Agreement from the Servicer?

Required Disclosures in Marketing Materials.

  • What specific disclosures are required in marketing materials for another MARS Provider?
  • What constitutes “competent and reliable evidence” that will support a representation by a MARS Provider to a Consumer regarding the efficacy of the MARS Provider’s services?
  • What is the Definition of Commercial Communication (16 CFR Section 322.2(c))?  And what are the Required Disclosures in General Commercial Communications.

Advance Fee Prohibitions.

  • How does a MARS Provider handle a Trial Modification offer from the Servicer?
  • What does a MARS Provider do when the Servicer provides a Modification Agreement but does not provide all of the information regarding the original loan and the modified terms that the Final Rule requires to be disclosed?


As attendees of the Webinar will learn, Mortgage Assistance Relief Services (MARS) are services offered or provided to a Consumer for consideration that are intended directly or indirectly to assist the Consumer with regard to:

  1. Stopping or postponing a foreclosure sale;
  2. Negotiating or arranging a Modification of a Dwelling Loan;
  3. Obtaining a forbearance in the timing of payments due on a Dwelling Loan;
  4. Negotiating or arranging any extension of the time period for curing a default or reinstating the Dwelling Loan;
  5. Obtaining a waiver of an acceleration clause or balloon payment in a Dwelling Loan;
  6. Negotiating or arranging a short sale, deed-in-lieu of foreclosure, title reconveyance, sale/leaseback or any other disposition of the Dwelling other than a sale to a third-party purchaser;
  7. Offering or conducting a Forensic Loan Audit which is a legal analysis of mortgage loan documents for the purpose of finding compliance violations under federal and/or state law or regulation for the alleged purpose of helping Consumers acquire leverage over their Servicers;
  8. Marketing of services to assist consumers in selling a   Dwelling to a third party if the intent of the sale is to enable the Consumer to avoid foreclosure; and
  9. Marketing of refinancing options by Mortgage Brokers if offered to avoid a foreclosure.



Although the intent is to avoid including real estate brokers and agents handling sales of real property in the definition of MARS, from the language contained in the Supplementary Information in the Federal Register, it is clear that real estate agents and brokers handling short sales, title re-conveyance or any other sale or endeavor undertaken in an effort to stop a foreclosure sale would be covered by the MARS definition.

The Supplementary Information states that the FTC does not consider the typical functions of real estate brokers, including showing homes, finding homes for Borrowers and listing homes for sale, to be MARS functions.  Nonetheless, any endeavor undertaken by a real estate agent or broker in an effort to prevent a foreclosure other than these typical functions, such as negotiating with a Servicer the terms of a short sale, WILL be considered a MARS activity.


Some attorneys may think that their own cursory reading of the new FTC rule is enough, but we would suggest that it is not.


Can a licensed attorney convey the Attorney Exemption in 16 CFR Section 322.7 to the attorney‘s law firm or law group when the law firm or law group is a dedicated MARS Provider that is staffed primarily by non-attorneys.

A similar issue has arisen under the California Foreclosure Consultant Act, which exempts licensed attorneys from requirements such as posting a $100,000 surety bond and registering with the California Department of Justice.  In a number of instances, the California Attorney General has cited California law firms run by licensed attorneys with failure to comply with the registration and posting of a surety bond.   The law firms were deemed to be subject to the California Foreclosure Consultant Act even though there were licensed attorneys in the firm who were ostensibly exempt from these requirements.

Here is what the FTC has to say about the reasoning behind the Attorney Exemption:

“Given the prevalence of attorneys engaged in unfair and deceptive practices in providing MARS and the experience of the states with categorical exemptions for all attorneys, the Commission has decided not to exempt attorneys across-the-board from the Final Rule. The record demonstrates that such a categorical exemption would open a large loophole to the Rule that MARS Providers would exploit to the detriment of the consumer…

Individuals with law licenses frequently engage in deceptive or unfair MARS practices or assist others who do. As with other services sold routinely through deceptive or unfair means, a broad attorney exemption can become an easy way for fraud artists to ply their trade without fear of law enforcement. Thus, the Commission concludes that merely possessing a law degree or a license to practice law is not an adequate basis for exemption from the Rule…

The Commission’s goal is to craft an exemption that enables attorneys to engage in the bona fide practice of law but does not create a loophole for unscrupulous attorneys who themselves engage in unfair or deceptive acts and practices in selling MARS or lend their credentials to those that do.”


Mandelman Matters decided to produce this important Webinar because this new Final Rule is something with which EVERYONE involved in, either directly or peripherally, helping consumers avoid foreclosure NATIONWIDE will need to understand inside and out, because…

Assisting and Facilitating Violators of the Final Rule (16 CFR Section 322.6).

It is a violation of the Final Rule for any person to provide substantial assistance or support to a MARS Provider when that person knows or consciously avoids knowing that the MARS Provider is engaged in any act or practice that violates this Final Rule.


Advance registration is required and the cost to attend is $250.

WHEN: January 25, 2011

TIME:   9:30 AM to 11:30 AM (Including time for Q&A.)


To register, click here:


Bios/Backgrounds of the Speakers…

Compliance attorney, Julie Greenfield has spent some 30 years as a mortgage banking compliance attorney, having been in-house counsel for two Lehman Bros. companies General Counsel at New Century Mortgage and Option One Mortgage. Now, she’s changed sides and represents the good guys… homeowners who need their loans modified and other professionals that help homeowners get loans modified.

Julie attended the University of Pennsylvania and graduated Phi Beta Kappa from Binghampton University and Villanova Law School.  She is also the Vice Chair of the Consumer Financial Services Committee for the California State Bar, she’s very active member of the American Bar Association’s Committee on Consumer Financial Services, and she’s a member of the Governing Committee of the Conference on Consumer Finance Law.  Julie has also been an expert witness in Truth in Lending and loan modification cases.

Martin Andelman is one of the country’s most outspoken advocates for homeowners caught up in today’s economic crisis, and the attorneys that represent them.  Martin is a staff writer for The Niche Report magazine, and writes the widely read blog, Mandelman Matters on ML-Implode, one of the highest trafficked sites in the mortgage industry.  He has written close to 400 in-depth articles covering the political, economic, social and legal aspects of the financial and foreclosure crisis.

Prior to devoting his time to Mandelman Matters, Martin spent 20 years as the CEO of his own consulting firm, The 4th Floor LLC, and has worked at the C-Suite and senior management level for such clients as JPMorgan, Merrill Lynch, Nationwide, AXA Equitable, Arthur J. Gallagher, Bain & Company, and numerous other professional service firms and Fortune 500 companies.  He is an author and speaker, and has in-depth expertise in areas including accounting, insurance, financial services and health care, and often writes on new legislation, including California’s Senate Bill 94 and the FTC’s new MARS rule, both related to loan modifications.

Martin majored in Economics as an undergraduate, and is alumnus of Pepperdine University’s Presidential/Key Executive MBA Program, Class of 1995, and also completed the graduate studies Masters program in Market Research/Direct Marketing at the University of Missouri at Kansas City, Block School of Business in 1993.

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