You Decide Realty · Short Sale & Foreclosure Help Center
A distressed homeowner is the easiest person in real estate to take advantage of. Scared, embarrassed, on a deadline, and reachable — because the Notice of Default is a public record and every predator in the valley pulls that list.
Nevada anticipated this and wrote some of the strongest consumer protections in the country. Most homeowners have no idea they exist. Here they are.
In Nevada, a person performing foreclosure or loan-modification assistance for compensation “shall not claim, demand, charge, collect or receive any compensation before a homeowner has executed a written agreement with the lender or servicer incorporating the offer of mortgage assistance obtained from the lender or servicer.” NRS 645F.405 Federal law imposes the same ban at 12 CFR § 1015.5. If someone wants money before your lender has signed something, that alone should stop you — and if they say they are attorneys, see the narrow exception below.
HUD-approved housing counseling is free. Legal Aid Center of Southern Nevada and Nevada Legal Services are free to those who qualify. The foreclosure mediation petition costs a nominal court filing fee. In a completed short sale, the lender pays the real estate commission out of proceeds. There is no legitimate reason for a homeowner in default to write a check to a “foreclosure specialist” before anything has happened.
Chapter 645F regulates “covered service providers,” “foreclosure consultants” and “loan modification consultants.” The definitions are broad on purpose — a “covered service” expressly includes financial counseling, contacting creditors on your behalf, arranging extensions or delays, assisting with bankruptcy filings, arranging loan purchases or principal reduction, and providing loan audits.
| Statute | What it requires or prohibits |
|---|---|
| 645F.390 | Licensing. Anyone performing covered services must be licensed, with fingerprints and an FBI background check on the application. |
| 645F.392 | Written contract required before any services are provided, with contents mandated by the Commissioner. |
| 645F.397–.398 | Mandatory disclosures — non-affiliation with government, that the lender has not approved anything, your payment obligations, and the risks of loan modification. |
| 645F.400 | Prohibited acts — undisclosed fees; taking a lien or security interest in your residence; accepting a power of attorney (except to inspect documents); misrepresenting affiliation with government or lenders; unsubstantiated claims; obtaining waivers of your statutory protections. |
| 645F.380 | Who is exempt — including a Nevada-licensed attorney acting in the performance of his or her duties as an attorney, and a licensed real estate broker or salesperson acting under that license. Note the carve-out to the carve-out: it does not cover an attorney employed by or affiliated with a licensed covered-service provider. |
| 645F.405 | The advance-fee ban. No compensation before you have executed a written agreement with the lender incorporating its offer. |
| 645F.410 | Administrative penalty of not more than $25,000. |
| 645F.420 | Your private right to sue for a violation of NRS 645F.400 — actual damages plus punitive damages of at least 1.5× actual damages. |
| 645F.430 | Foreclosure purchaser fraud — a gross misdemeanor, up to 364 days and a $50,000 fine. |
12 CFR Part 1015 covers any mortgage assistance relief service offered for consideration, and short sale negotiation for a fee is squarely within it. It bars telling a consumer to stop contacting their lender, requires the disclosure “(Name of company) is not associated with the government” and “Even if you accept this offer and use our service, your lender may not agree to change your loan,” and bans collecting any payment before you have executed a written agreement incorporating the lender’s offer.
The attorney exception, stated accurately. Under 12 CFR § 1015.7, a licensed attorney rendering these services as part of the practice of law is exempt from most of the rule — and may take an advance fee only if the money goes into a client trust account before legal services are performed and the attorney complies with state trust-account law. Nevada similarly exempts a Nevada-licensed attorney acting in the performance of his or her duties as an attorney from Chapter 645F entirely NRS 645F.380(1) — but that exemption does not extend to an attorney employed by or affiliated with a licensed foreclosure-consultant business. So when someone says “we’re a law firm,” ask two questions and get the answers in writing: are you licensed in Nevada, and is my money going into a client trust account?
| Red flag | Why it matters |
|---|---|
| Asks for money before you have signed an agreement with your lender | Violates NRS 645F.405 and 12 CFR 1015.5 |
| Tells you to stop talking to your lender or servicer | Violates 12 CFR 1015.3 |
| Claims to be affiliated with or approved by the government | Violates 645F.400 and 1015.3; the required disclosure says the opposite |
| Guarantees a result or a specific timeframe | Benefit claims require “competent and reliable evidence” under 1015.3 |
| Asks you to sign over your deed, or sign documents you have not read | Bait-and-switch and equity skimming. A deed transfer does not discharge your mortgage. |
| Asks you to make mortgage payments to them instead of your lender | Classic phony-counseling pattern — FTC |
| Wants cashier’s checks, wire transfers, or payment apps | FTC-listed warning sign; these are hard to reverse |
| Asks for power of attorney | Prohibited by NRS 645F.400 except to inspect documents |
| Wants a lien or security interest in your home as payment | Prohibited by NRS 645F.400 |
| Pitches a “forensic loan audit” | FTC warns against it; a licensed covered service in Nevada under 645F.310 |
| Markets HAMP, HAFA, HARP, MHA, or the Nevada HAF as currently available | All defunct or closed. The MHA deadline expired December 30, 2016; Nevada’s HAF is closed. |
| Says “we’re attorneys, so the fee rules don’t apply” | Partly true, and easy to abuse. 12 CFR 1015.7(b) permits an attorney advance fee only into a client trust account; NRS 645F.380(1) exempts only Nevada-licensed attorneys acting as attorneys — not attorney-affiliated consultant shops. Ask both questions. |
You Decide Realty is a licensed Nevada real estate brokerage. We are not attorneys, tax advisors, credit counselors, or a foreclosure consultant under NRS 645F. We do not charge homeowners a fee for guidance, a valuation, or a records check. If we represent you on a sale, we are paid a commission at closing — and in an approved short sale, the lender pays it from the sale proceeds. That is the whole arrangement, and you should expect anyone you talk to be able to state theirs just as plainly.
Questions we get every week
No. NRS 645F.405 prohibits a person performing covered services, a foreclosure consultant, or a loan modification consultant from claiming, demanding, charging, collecting or receiving any compensation before the homeowner has executed a written agreement with the lender or servicer incorporating the lender's offer of mortgage assistance. Federal law imposes the same ban at 12 CFR § 1015.5, with one narrow exception: under 12 CFR § 1015.7 a licensed attorney rendering these services as part of the practice of law may take an advance fee only if it goes into a client trust account and the attorney complies with state trust-account rules. Nevada separately exempts a Nevada-licensed attorney acting as an attorney from Chapter 645F under NRS 645F.380(1), though not an attorney affiliated with a licensed consultant business. Violations can carry an administrative penalty of not more than $25,000, and NRS 645F.420 gives a homeowner a private right of action for a violation of NRS 645F.400 — actual damages plus punitive damages of at least 1.5 times actual damages.
Treat it as a scam until proven otherwise. The Nevada Attorney General lists this pattern — 'The Bailout' or leaseback — as a known foreclosure fraud, describing terms deliberately structured to be 'so onerous that the buy-back may be impossible' so that the scammer takes the equity. Before signing anything that transfers title, have a Nevada attorney review it and call a HUD-approved counselor at 800-569-4287 for a free second opinion.
No. This is one of the most damaging misconceptions in foreclosure. Transferring the deed does not eliminate your obligation on the promissory note. You can lose the property and the equity and still be liable on the loan, while whoever took the deed rents or sells the home and keeps the proceeds. The FTC identifies this as equity skimming and the Nevada Attorney General lists it among mortgage fraud patterns.
The FTC warns that no one can legitimately promise a forensic loan audit will get you a loan modification — even if a lender made errors, and even if you sued and won, the lender is not obligated to modify your loan. In Nevada there is an additional layer: 'providing loan audits' is expressly listed as a covered service under NRS 645F.310, meaning the provider must be licensed and is subject to the advance-fee ban.
HUD-approved housing counseling agencies, at 800-569-4287 or through the CFPB's counselor search. Legal Aid Center of Southern Nevada and Nevada Legal Services for those who qualify. The Civil Law Self-Help Center at the Regional Justice Center for foreclosure and mediation self-help forms. Home Means Nevada, Inc. administers the state's foreclosure mediation program. All of these are free or nominal-cost, and none of them will ask you for an advance fee.
Once a Nevada trustee’s sale is held, title vests in the purchaser with no right of redemption — there is no undo. But until then, an owner-occupant’s right to reinstate generally runs to five days before the sale, and a pending offer is a reason to ask for a postponement.
702-843-0044Ken Calder · Nevada Broker B.1001776 · Speak to a licensed broker, not a call center.
Free · Confidential · No obligation
No judgment, no sales pitch, and no pressure to list anything. If the right answer is a loan modification, a bankruptcy attorney, or a HUD counselor instead of us, that is what we will say. We are a licensed Nevada brokerage, not a foreclosure rescue company — and we never charge a homeowner a fee to look at their situation.
We do not publish a figure, a deadline, or a statute we have not read. Every claim above traces to one of these. If you find something here that is out of date, tell us and we will fix it and re-stamp the page.