Landlord Faces Discrimination Complaint For Allegedly Forcing White Tenant's Move After Being Seen Talking With Black Neighbors In Front Yard

The U.S. Department of Housing and Urban Development announced last month:

• The U.S. Department of Housing and Urban Development (HUD) [last month] announced that it has charged two Tallassee, Alabama landlords with violating the Fair Housing Act for allegedly forcing white tenants to move out of their house after the owners saw the couple talking with black neighbors in their front yard.(1)

For the rest of the press release, see HUD Charges Alabama Landlords With Discrimination (Couple forced to move after visit from black neighbors).

(1) According to the press release, in February 2008, Melissa Jones, her fiancé, and their child moved into a property owned by Wilber and Julie Williams. While Jones' African-American neighbors were visiting with her in the front yard, the Williamses drove by and witnessed the gathering. Later that day, Ms. Williams called Ms. Jones and allegedly said, "Those people need to leave. I don't want those people on my property." According to the HUD charge, Ms. Williams intimidated and coerced Ms. Jones during another phone call.

Partnership Deal Results In 78 Year Old Connecticut Man's Eviction From Home, Losing Farm & 50% Interest In Property; Now Living Out Of Car

In Greenwich, Connecticut, the Greenwich Citizen reports:

• After 43 years of operating Purdy's Farm on King Street, Delmo Zanette effectively became a farmer without a farm at midnight Oct. 31. Not by choice -- at least by his account.

• The 78-year-old Zanette was ordered to vacate the property by court order resulting from a legal battle that began four years ago and ended on Oct. 7 when the court finally ruled against him and in favor of Ronald Pecunies and Arthur K. Watson Jr. - his business partners and now adversaries in the case.

***

• "I was 100 percent owner of the farm and somehow they got hold of 50 percent of my real estate," said Zanette in a phone interview this past week with the Greenwich Citizen. "I was too trusting, I did not have a lawyer I trusted them implicitly ... but somewhere things didn't go right."

***

• Zanette says with the closing of the farm, he is now surviving on income from his monthly Social Security check of $574 and hopes to raise additional money by having tag sales of antiques and a collection of some farm artifacts and books he owns. Despite having some family in the area, Zanette says he is living out of his Suburban and periodically on the couches of family and friends. [...] Currently, Zanette is still 50 percent owner in the properties, which are now on the market with Weichert Realty, listed for $2.6 million.

For more, see A Farmer Without a Farm: What to Do?

Overseas Soldier Facing Foreclosure Over Payment Snafu Looks To TV Troubleshooter To Shine Light On Lender, Straighten Out Mess

In Raleigh, North Carolina, WTVD-TV Channel 11 reports:

• [M]ajor Dianna Echard worked so hard for all these years in the military here and in faraway war zones. But when she got home to Raleigh, she couldn't get inside her home. The locks had been changed. Major Echard tells Troubleshooter Diane Wilson, "I've tried to pay. It's like I'm giving money away and no one is willing to take it." Even though she says she's always had the money to pay her mortgage.

For more, see A local soldier fights foreclosure issues.

Foreclosing Lender Seeks "Rent To Own" Permit From City Council To Unload Unsold New Condo Units

In Marlborough, Massachusetts, Community Advocate reports:

• The current owner of the Trinity Court Development on West Main Street, Henry Bar, appealed to the City Council Nov. 24 for a special permit to modify restrictions placed upon the condo development. Citing hardship from the current economic climate, Bar, who has yet to sell one of the condos, is requesting a special permit to allow a temporary modification to the condition stipulating owner occupancy.

***

• After lowering the price twice, he said that the current sale price, which is around $299,000, is already down 25 percent from the original asking price. In an effort to get people living there, Bar would like to offer potential homeowners the option of renting to own or simply renting.

For more, see Condo developer asks for rent-to-own option.

Prince George's State's Attorney Nearing Indictment On 20 Mortgage, Foreclosure Fraud Cases; Lawyers, Loan Officers, Others In The Cross Hairs

In Upper Marlboro, Maryland, The Maryland Daily Record reports:

• The Prince George’s County State’s Attorney’s Office hopes to send a message to potential perpetrators of mortgage fraud: “Not in this county.” Operating since September, the office’s new Mortgage and Foreclosure Division is hoping to bring 20 cases to indictment soon, said Assistant State’s Attorney April Richardson.

• Richardson said the division is moving forward against loan officers, title companies, lawyers and brokerages thought to have participated in mortgage scams.

For more, see Mortgage fraud unit targets lawyers, loan officers.

Commercial Morgage Meltdown On The Horizon?

The Associated Press reports:

• The full scope of the housing meltdown isn't clear, and already there are ominous signs of a new crisis — one that could turn out the lights on malls, hotels and storefronts nationwide.

• Even as the holiday shopping season begins in full swing, the same events poisoning the housing market are now at work on commercial properties, and the bad news is trickling in. Malls from Michigan to Georgia are entering foreclosure.

For more, see Commercial mortgages could melt down next.

Florida Pastor, Wife Charged With Swindling Elderly Couple Out Of $100K+ In Alleged Real Estate Sale, Refinance Scam

From the Florida Department of Financial Services:

• Florida Chief Financial Officer Alex Sink announced [Wednesday] that additional charges have been filed against a Jensen Beach pastor and his wife in an ongoing investigation by the Department of Financial Services, Division of Insurance Fraud (DFS), into allegations the couple bilked investors throughout central and south Florida out of more than $8 million in fraudulent real estate schemes.(1)

• In the newest charges, Rodney and Shalonda McGill are accused of duping an elderly couple out of more than $100,000 worth of property and cash.

For the rest of the press release, see CFO Sink's Call For Additional Information Results In New Charges For Jensen Beach Pastor, $500,000 Additional Bond.

(1) According to the press release, the McGills already face charges of Racketeering, first degree; Conspiracy to Commit Racketeering, first degree; Grand Theft, first degree; Grand Theft, third degree; and Obtaining a Mortgage by False Representation, third degree, for saddling investors with more than $1.15 million in mortgage loans by “flipping” properties in Martin and St. Lucie counties that the McGills sold using fraudulent loan applications. The additional charges announced Wednesday, two counts of grand theft in the first degree, mean the McGills face up to 30 years each in prison as well as penalty enhancements provided by Florida law for theft from persons over the age of 65, the press release states.

More Failed "Contract For Deed" Deals, More Homebuyers, 3rd Party Investors Left Holding The Bag

In Centerton, Arkansas, The Morning News reports:

• James and Patricia Leach of Bentonville couldn't believe their luck in September 2006 when they were approved to buy a home. [...] But two years, two months, and $51,000 later, they are packing their belongings and moving across town to a home they are renting.

• The Leaches are one of at least two dozen local families who recently discovered the homes they thought they purchased through the Real Estate Co. of Arkansas actually belong to someone else.

***

• Financing was arranged through Greenleaf Companies of Springfield, Mo. Greenleaf, through its contractor Bentonville-based Real Estate Co., was a third party that arranged for real estate investors across the nation to purchase homes, which were then resold to local families through a contract for deed.

For more, see Home Deal Fails For Centerton Families.

Go here for other posts on Greenleaf Companies and The Real Estate Co.

For more on problems with "Contract for Deed," "Rent To Own", and "Lease / Option" real estate deals, go here and go here. rent to own lease purchase option scams yellowstone

Loan Officer Convicted For Role In Mortgage Scam Defrauding 200+ People, 20 Banks; Described As "Architect" Of Scheme

In Columbus, Ohio, The Columbus Dispatch reports:

• A loan officer was convicted yesterday for his role in a scheme that defrauded more than 200 people and 20 banks, but an appraiser who worked with him was acquitted of all charges in the case. After about eight hours of deliberations, a federal jury convicted Jonathan L. Boyd for a mortgage-fraud scam that was fueled by greed and aided by a hot real-estate market, prosecutors said.

• Early in the afternoon, the jury returned with not-guilty verdicts for co-defendant James D. Gaither, who was accused of inflating appraisals to match the prices of properties for which Boyd found buyers.

***

• Prosecutors said Boyd, 39, [...] and Gaither, 38, [...] targeted "inexperienced buyers" in 2003 and 2004, when homes were selling quickly. Many of the homes approved for loans or appraised by the men ended up in foreclosure, agents for the Internal Revenue Service said. [...] Prosecutors had said Boyd was the architect of the scheme.

For more, see Mortgage officer guilty of fraud.

For a copy of the original indictment, see U.S. vs. Green, Schottenstein, et al.

Go here for earlier reports on this scam.

Bring Philadelphia Foreclosure Diversion Program To Chicago, Say City, Cook County Officials

In Chicago, Illinois, Chicago Defender reports:

• A new foreclosure program in Philadelphia has been so successful there that Cook County Clerk of the Circuit Court Dorothy Brown said the county should duplicate to slow the rash of foreclosures here.

• Brown and other elected officials joined Action Now, a Chicago housing non-profit organization, at a Tuesday news conference to propose a local version of the Philadelphia Residential Mortgage Foreclosure Diversion Pilot Program , a foreclosure diversion program that has proven successful in East Coast city.

For more, see City, county leaders look to bring Philly foreclosure program to Chicago area homeowners.

See also, WBBM-780 AM: Cook County Judges Urged To Decrease Foreclosures (Cook County judges are being called upon to implement a plan that's designed to decrease foreclosures. The plan is modeled after a program in Philadelphia).

Go here for a copy of the foreclosure diversion program, Joint General Court Regulation No. 2008-01, Court of Common Pleas of Philadelphia County.

Some Real Estate Agents Now Arming Themselves To Protect Against Dangers Of Selling Vacant Foreclosures

In Merced, California, KFSN-TV Channel 30 reports:

• The foreclosure crisis has left thousands of homes throughout the Central Valley in ruins and some realtors are running into trouble when they try to sell foreclosed homes. Graffiti and garbage aren't the only things realtors now find when they enter foreclosed homes.

• "Several times I've walked up and there's unsavory folks in the house who don't belong there, and it's frightening. It's dangerous," said Merced County Realtor Andy Krotik. That's why he said he's applying for a concealed weapons permit, and he's not alone. "I've got several colleagues who are also in the business that work with bank owned properties who either have their concealed weapons permit or are in the process of getting one, for the same reason, we all fear for our safety."

For more, see Foreclosure Leaves Homes in Ruin.

In related stories, see:

• San Jose Mercury News: Squatters in abandoned homes raise fears among East County Realtors,
• KGO-TV Channel 7: Vandals target foreclosed homes.

Go here for posts on squatters & foreclosures. squatter foreclosure zebra BetaVacantForeclosure

Abandoned Property Dangers Move Town Officials To Post Signs Warning Fire Responders Of Hazardous Homes

In the MetroWest region of Massachusetts, The MetroWest Daily News reports:

• As the staggering economy leads to more foreclosures, local officials are left to deal with the problem of keeping the empty homes from becoming eyesores and safety hazards.

***

• The insides of some homes are so torn apart that [Marlborough's code enforcement officer Pamela] Wilderman worries about firefighters who might answer calls. As a result, the city identified about 25 hazardous properties where it has put up signs on the outside that warn responders to enter with extreme caution. Wilderman went around with Deputy Fire Chief Ron Ayotte for a full day putting up the warning signs.

For more, see Empty homes a danger to fire fighters and a nuisance to officials. BetaVacantForeclosure

Central Indiana's Abandoned Home Problem At Crisis Proportions; Lender Inaction Leaves Some Properties In Legal Limbo

In Indianapolis, Indiana, WTHR-TV Channel 13 reports:

• From starter homes in Greenwood to million-dollar mansions in Geist, tens of thousands of homes throughout central Indiana are now vacant, abandoned or in foreclosure. While some of the properties are being well maintained, most are not.

***

• 13 Investigates' tour of abandoned homes found properties that have been ransacked and vandalized. Others have collapsed ceilings. Rotten food, mold and mildew create foul odors that neighbors call "unbearable."

***

• In the past two years, the Marion County Health Department has seen a 30% increase in unsafe housing complaints, largely fueled by the recent foreclosure crisis that has prompted many families to give up their homes. [... I]n some situations, 13 Investigates has learned banks and mortgage companies take no action on abandoned properties, leaving both the city and neighbors in a legal limbo.

The existing unsafe conditions in some of the homes is highlighted by caved-in ceilings, the proliferation of toxic black mold, the presence of dead animals inside the homes, and the death of a five year old child, who reportedly drowned in an unsecured pool of a vacant, foreclosed home.

For more, see Foreclosed and forgotten (read story) (watch WTHR Channel 13 video).

Go here, Go here, Go here, Go here, and Go here for posts on vacant homes leaving their mark on neighborhoods.

Go here for other posts on problems associated with homes in legal limbo. responsibility code violations foreclosure BetaVacantForeclosure

Mortgage Audit Services Offered To Homeowners In Financial Trouble

The Boston Herald recently ran a story on the mortgage audit industry, a group that is offering their services to homeowners in trouble with their mortgages:

• [M]ortgage auditors review customers’ loan papers for forged signatures, sham home appraisals or other illegal acts. Any wrongdoing can strengthen financially strapped homeowners’ hands in negotiations with lenders.

• Many customers are seeking “loan modifications,” where banks agree to cut homeowners’ interest rate or otherwise change mortgage terms to help homeowners avoid foreclosure. Others want lenders to OK “short sales,” where borrowers sell homes in today’s weak market for less than their unpaid mortgage balances and banks simply “eat” the difference.

***

• Common flaws include math errors on federal Truth in Lending Act forms, which by law must accurately list a mortgage’s total lifetime cost within $35. While such mistakes can seem minor, they often give homeowners just enough leverage to get out of fraudulent loans.

Reportedly, one firm featured in the story performs about 100 checks on each customer’s loan, producing five- to 15-page reports and charging about $350 to $600.

For more, see Mortgage ’auditors’ help people fight foreclosure. missing mortgage foreclosure docs gamma UndoMortgageLoans TILAdelta

Are Lenders Proactively Offering Borrowers Cash In Exchange For Waiving TILA Violations?

An "Ask The Lawyer" Q & A article appearing last month in the Atlanta Journal Constitution posed the following question:

• I received a letter from my lender stating that a Truth in Lending Disclosure Statement was not prepared and provided to me prior to closing my loan. I was sent forms to sign and was told that I would be sent $250, for my inconvenience when the forms were completed and returned. Is my lender buying me off for a measly $250? Can I get more? Isn’t it a pretty big offense to not provide the Truth in Lending Disclosure?

For more, see Settle for $250, or go for a possible $1,000 (Latter payoff for lender’s failure to provide form less likely, bigger hassle). missing mortgage foreclosure docs gamma

Chicago Apartment Building Converted To Condominiums Without Notice To Tenants At Center Of Straw Buyer Mortgage Fraud Probe

In Chicago, Illinois, the Chi-Town Daily News reports:

• A state agency today revoked the Illinois licenses of two mortgage companies and filed complaints against an appraiser and a real estate company in connection with a mortgage fraud investigation at a West Side residential building.

• The Daily News reported last week that tenants at 2754 W. Washington Blvd. suspect their apartments were sold to straw buyers by the building's former owner. The tenants say they remain unclear as to who actually owns the building, have stopped paying rent, and have banded together to take care of the building's utilities and maintenance.

For more, see State moves against mortgage companies at W. Side building.

See also:

• Chi-Town Daily News: In wake of bribery scandal, tenants question landlord's dealings (Residents of a building linked to a federal bribery probe earlier this year say their apartments were transformed into condominiums and sold without their knowledge, and their suspicions have prompted a state agency to investigate),
• Illinois Department of Financial and Professional Regulation press release,
• State of Illinois orders & complaints filed against Envision Lending Group, Gateway Mortgage Group, Arthur Pascu, Pawel Janowicz, Peter Petrovich, LMB Properties, LLC.

Felonious Rent Skimming, Foreclosure Fraud Charges In Alleged Land Grant "Rescue" Scam Ruled Constitutional, Says California Judge

In San Diego, California, CW Channel 6 reports:

• Felony civil code violations alleging rent skimming and foreclosure fraud against five people accused of victimizing hundreds of San Diego County homeowners are constitutional, a judge ruled Friday.(1) [...] The defendants face a total of 172 charges, including conspiracy and grand theft.

***

• At a hearing in May, Deputy District Attorney Stephen Robinson alleged that the defendants offered to help homeowners keep their property by placing them in "land grants," when in fact the transactions were bogus and left them even worse off than they were before.

For more, see Foreclosure Fraud Charges.

Go here for more on this alleged Southern California land grant, foreclosure rescue scam.

(1) According to the story, Superior Court Judge Charles Rogers denied a legal challenge to the charges against William Hutchings, 62, and his wife Xiaoke Li, 45; Shawna Landis, 36; Diego Gil, age unknown, and Edgar Martinez, 30.

Las Vegas Family Of Four Gets Screwed Over In Lease-Purchase Of Home In Foreclosure

In Las Vegas, Nevada, the Las Vegas Review Journal recently reported the story of a family of four who had relocated from Hawaii, and who had entered into a lease-purchase agreement for the purchase of the family home. Unbeknownst to the family, the home was in foreclosure.

For the rest of the story, see THE FACES OF HARD TIMES: 'We put our trust in people' (Alleged scam involving lease-purchase of foreclosed home sends family back to Hawaii). ThetaTenantRentSkimming rent to own lease purchase option scams yellowstone

Brooklyn "Fight Foreclosure" Free Legal Seminar

From the Brooklyn Daily Eagle:

• Tues.-Wed. Dec. 2-3, Free CLE/Workshop: Foreclosure Prevention Law, 9:30 a.m.-4 p.m. Topics: Subprime and exotic mortgage markets; federal and state claims for foreclosure prevention; litigation practice; loan workout strategies and options; foreclosure prevention resources. Mandatory for all Center for New York City Neighborhoods (CNYCN).

• CLE accreditation pending. Held at the Brooklyn Bar Association, 123 Remsen St. Free. Pre-registration required. For information contact NEDAP: (212) 680-5100. To register, contact CNYCN: info@cnycn.org, or (212) 566-3050 x2.

Source: Free CLE/Workshop: Foreclosure Prevention Law.

Lender Forks Over $11M To Settle False Claims Act Charges With Illinois Feds; Allegedly Gave False Info On 219 FHA Loans That Ended Up In Foreclosure

In Chicago, Illinois, Reuters reports:

• A Royal Bank of Canada mortgage unit will pay $10.98 million to settle charges it gave the U.S. government false information about borrowers who took out 219 home loans that ended up in foreclosure.

• RBC Mortgage Co agreed to the payment to avoid litigation but denied wrongdoing, according to Patrick Fitzgerald, the U.S. attorney in Chicago, who announced the settlement.

***

• The civil case is related to a separate federal criminal probe that resulted in the convictions of 25 defendants, including three RBC Mortgage officers, Fitzgerald said.

For more, see RBC pays $11 mln to settle US mortgage fraud probe.

From the Office of the U.S. Attorney (Chicago):

• Press release: RBC Mortgage Co. To Pay U.S. Nearly $11 Million To Settle Claims Over FHA-Insured Mortgages Issued By Former Rockford Office,
• Settlement Agreement.

Lack Of Legal Standing Apparently Not A Concern To Some Foreclosing Lenders; Would Rather Play The Odds That Homeowners Won't Contest Legal Actions

Buried in a recent article in the Connecticut Law Tribune is this excerpt, which may reflect the arrogance of some mortgage lenders and their general contempt for the legal system when bringing foreclosure actions against homeowners even though they lack the legal standing to do so:

• [Attorney Patrick] Begos’ firm [Begos, Horgan & Brown] has attempted to carve out a niche with banks to review their troubled loans and to ensure that the banks had standing to file foreclosure proceedings.

• Earlier this year, firm member Christopher Brown got a case against his homeowner client dismissed in New Haven Superior Court because Brown showed that the plaintiff mortgage company couldn’t prove it held the mortgage at the time it filed suit.(1)

• Despite that outcome, banks didn’t bite on Begos’s pitch, telling him that they would rather play the odds that most homeowners won’t contest foreclosures in court.(2)

Source: Adapting On The Fly (Solos, small firms make quick changes in bad economy).

For posts that reference the failure of some mortgage lenders and their attorneys to prove ownership of the promissory note when starting foreclosure actions, Go Here, Go Here, Go Here, and Go Here.

(1) See Connecticut Law Tribune: Shaky Standing (Foreclosure cases identify shoddy record-keeping in mortgage industry).

(2) Even if the homeowners fail to contest foreclosures, a lender's lack of legal standing in bringing an action leaves open a possible future attack that the foreclosure judgment obtained in a court that lacked jurisdiction is void, thereby raising the possibility that judgments obtained and foreclosure sales that have already taken place could be voided or otherwise set aside. Reportedly, the issue of void foreclosures where lenders allegedly lacked legal standing has recently been raised in a Massachusetts lawsuit. The suit seeks to set aside past foreclosures involving two lenders, halt any actions they currently have in the pipeline, and seeks class action status. See Thousands Of Foreclosures Are Void, Says Massachusetts Class Action Demanding Lenders & Their Lawyers Prove Note Ownership. missing mortgage foreclosure docs gamma

Loan Modification Firms Swarm Courthouses To Find Leads; Cash-Strapped Homeowners Find Mailboxes Stuffed With Junk Mail, Salespeople On Doorstep

A recent editorial in The New York Times makes this observation:

• The demise of the subprime mortgage industry has been hard on predatory brokers, too. They feasted for years on bad loans until reality crashed down and the money ran out, and there they were: sharks without a frenzy.

• Now they are circling again. Predators of every sort have regrouped and returned to their old ways, this time as loan-modification companies, inserting themselves between hard-strapped homeowners and banks, offering to work deals — for cash up front.

***

• Troubled homeowners know all about the relentlessness of the loan-rescue racket: it fills their mailboxes and sends salespeople to lurk on their doorsteps. Foreclosure filings are public records, and loan modifiers routinely swarm courthouses to find leads.

• Loan counselors at the Long Island Housing Partnership, a respected nonprofit in Hauppauge, N.Y., tell of scammers crashing its housing workshops, posing as troubled borrowers, then working the crowd with sales pitches.(1)

For more, see Return of the Predators.

(1) Some state attorneys general have already started going after these loan modification firms. For example, there are ongoing efforts by the state AGs in Illinois, Tennessee, Colorado, and Florida. Further, state AGs in Tennessee and Florida have reportedly also included allegations of unauthorized practice of law in their actions against loan modification firms.

Equitable Mortgage Defense Invoked In Lease-Purchase Agreement; Judge Denies Tenant Eviction, Says Foreclosure Is Required To Boot Renter

In Sarasota, Florida, local real estate attorney Jefferson F. Riddell writes in the Bradenton Herald on the fear (for a landlord) that a court will not allow a property owner to evict a tenant under a lease-purchase arrangement:

• [T]he fear was realized recently when the seller under a lease purchase type document went to county court in Sarasota to evict the tenant for failure to make monthly payments. The judge scrutinized the document, concluded that it was an agreement for deed and required the seller to foreclose it in circuit court like a mortgage.

• Cost to the seller for the foreclosure was about $2,000 instead of the nominal cost of a tenant eviction, and the buyer was able to stay in the property rent free for months while the foreclosure was being completed.

Source: Watch out for lease purchase agreements.

Phoenix Man Found Guilty For Filing Fraudulent Lien Releases On Home, Then Pocketing $850K In Subsequent Refinance

From the Office of the Arizona Attorney General:

• Attorney General Terry Goddard [last week] announced that Delanie Belfield Ross, 39, of Phoenix, has been found guilty by a Maricopa County Superior Court jury on three counts of felony fraudulent schemes and practices and one count of theft.

• According to court documents, Ross, along with his wife, Veronica Cooper Ross, and his brother-in-law, Willard Cooper, fraudulently obtained mortgage loans for the purchase of a $3.2 million Paradise Valley home in 1994.

• After taking possession of the house, Delanie Ross recorded fraudulent releases of the liens on the loans with the Maricopa County Recorder. He then represented the house as being owned free and clear to potential investors and obtained an $850,000 line of credit from a private family of investors, using the house as collateral.

For the Arizona AG's press release, see Phoenix Man Found Guilty of Felony Fraud and Theft.

For the original indictment in this matter, see State of Arizona v. Ross.

The Best Defense Is A Good Offense, Says Homeowner's Foreclosure Attorney

In Orlando, Florida, Central Florida News Channel 13 reports:

• Matt Englett, the lawyer of a Longwood man who lost his job and is in foreclosure, is working to modify his client's loan and do whatever it takes to make sure his client has a place to live. "I can take a 90-day uncontested foreclosure, and I can drag it out for two or three years if we have to," Englett said.

***

• Englett warned just because lenders contact you and make you think they are working with you to modify your loan, look into taking action anyway. If not, the lender may go ahead and take your home before you know it.

For more, see Take Action Against Your Lender During Foreclosure. missing mortgage foreclosure docs gamma

FHA Insurance Armageddon Within 18 Months, Predicts Ex-Mortgage Investigator As Subprime "Wolves" Now Make Comeback As FHA Lenders

BusinessWeek reports:

• As if they haven't done enough damage. Thousands of subprime mortgage lenders and brokers—many of them the very sorts of firms that helped create the current financial crisis—are going strong. Their new strategy: taking advantage of a long-standing federal program designed to encourage homeownership by insuring mortgages for buyers of modest means.

***

• For generations, these loans, backed by the Federal Housing Administration, have offered working-class families a legitimate means to purchase their own homes. But now there's a severe danger that aggressive lenders and brokers schooled in the rash ways of the subprime industry will overwhelm the FHA with loans for people unlikely to make their payments. Exacerbating matters, FHA officials seem oblivious to what's happening—or incapable of stopping it. They're giving mortgage firms licenses to dole out 100%-insured loans despite lender records blotted by state sanctions, bankruptcy filings, civil lawsuits, and even criminal convictions.

***

• Gary E. Lacefield, a former federal mortgage investigator who now runs Risk Mitigation Group, a consultancy in Arlington, Tex., predicts: "Within the next 12 to 18 months, there is going to be FHA-insurance Armageddon."

For more, see FHA-Backed Loans: The New Subprime (The same people whose reckless practices triggered the global financial crisis are onto a similar scheme that could cost taxpayers tons more) (go here for entire story on one web page).

Deed Thief Strikes S. Florida Couple; Regain Title After Year & A Half Of Aggravation

In West Palm Beach, Florida WPTV Channel 5 reports:

• You've heard of horse thieves, well how about house thieves? It's a wild west kind of scam that can lead to the loss of what's probably your most valuable asset. Your house. And it turned out to be a nightmare situation for a Loxahatchee couple.

Reportedly, it took extensive investigative work on the part of the police and the homeowners to get the home back, but not after a year and a half, almost $4000 dollars in court costs, time from work, the aggravation and the stressful nights. The homeowners also reportedly lost their homestead exemption and their homeowner's insurance as a result of their home's title being taken out of their name.

For the story, see House thieves, who can steal your home.

Go here, go here, go here, and go here for other posts related to deed or refinancing scams by forgery, swindle, etc. DeedTheftAlpha

Texas A Handy Haven For Those Seeking To Dodge Debts?

Bloomberg News reports:

• Homeowners fleeing underwater mortgages in California and Florida know where to come up for air: Texas.

• "Texas is an extremely friendly place to live if you owe money and do not want to pay,'' said Marjorie Britt, a bankruptcy attorney with Britt & Catrett PC in Houston. "If you have a lot of money and even more debt and want to shelter your assets, you can live fairly normally.''

• Distressed borrowers can hang on to luxury cars, a primary residence, paychecks, retirement accounts, and even jewelry that creditors might claim elsewhere, Britt said.

For more, see Deadbeat Homeowners Tap Texas Bankruptcy Laws to Duck Creditors.

South Florida Developer Takes Hike, Unloading Unfinished 396 Unit High Rise Complex On Constuction Lender

In Broward County, Florida, the Daily Business Review reports:

• Corus Bank, one of the most active lenders to developers during the condo construction boom, is taking title to the twin, 26-story Tao Sawgrass condominium buildings in Sunrise in lieu of foreclosure. Although there have been no closings on the complex’s 396 units, purchase deposits are in place on about 80 percent of the project, according to John Barkidjija, a Corus senior vice president in Chicago.

For more, see Condo Meltdown: Corus Bank takes title to Tao condos, hires firm to finish construction.

Obama Dodges "Embarrassment Bullet" As Pritzker Squelches Talk Of Her Interest In Commerce Secretary Position

American Chronicle reports:

• Billionaire Obama campaign finance chair Penny Pritzker did the smart, maybe the only, thing she could when she quickly scotched talk that she wanted to be Obama's Commerce Department Secretary.

***

• Pritzker and her failed Chicago based Superior Bank were knee deep in the subprime lending mess. The bank engaged in deceptive and faulty lending, questionable accounting practices, and charged hidden fees. It did it with the sleepy-eyed see-no-evil oversight of federal regulators. It made thousands of dubious loans to mostly poor, strapped homebuyers. A disproportionate number of them were minority.

***

• The predictable happened when many of the distressed homebuyers lost their homes. When the bank collapsed Pritzker and bank officials skipped away with their profits and reputations intact.

For more, see Pritzker Saved Obama Much Embarrasssment By Bowing Out Of Commerce.

South Florida Contractor Faces More Felonies For Allegedly Taking Customer Cash, Failing To Start, Finish Remodeling Jobs

In Plam Beach County, Florida, the South Florida Sun Sentinel reports:

• [P]olice arrested Douglas Livingston, 41, [...] accusing him of two felonies- fraud and grand theft of more than $50,000. He took money from four Delray Beach clients for remodeling jobs that the company either never started or failed to finish, said Detective Tom Whatley of the Delray Beach Police Department.(1)

For more, see Oakland Park man arrested again on construction-related theft charges.

See also, WPTV Channel 5: Man arrested for allegedly scamming thousands of dollars.

For other posts on homeowners left in the lurch due to actions by builders/contractors, go here, go here, go here, go here, and go here.

(1) According to the story, the latest accusations echo the charges that Livingston, of Oakland Park, faces in Broward County Circuit Court as the chief executive officer of the now-defunct HomeCo Unlimited. He was reportedly arrested in November 2004 on 70 counts of extortion, theft and fraud related to remodeling jobs never completed. Former HomeCo customers accused him of verbally intimidating them, prompting six to file police reports against him, the story states. StiffingContractorsTheta

New Jersey Family Seeking Mortgage Rescue Now Left Fighting Foreclosure

In Bergen County, New Jersey, South Bergenite recently ran a story on a local homeowner who contends his home was stolen from him through an elaborate home foreclosure rescue plan involving a sale leaseback arrangement with a buyback option. He and his family are curently facing foreclosure and, reportedly, the FBI is investigating the arrangement as a possible scam.

For the story, see Fighting foreclosure.

Disbarred Attorney Indicted On Charges Of Pocketing $100K From Clients' Escrow Accounts

From the Queens County, New York district attorney:

• Queens District Attorney Richard A. Brown announced [...] that a former Queens attorney has been arraigned on charges of looting the escrow accounts of several clients and failing to return over $100,000 that she had been holding on behalf of those clients.

***

• District Attorney Brown said that, according to the indictment, [attorney Arelia] Taveras accepted $2,500 from a buyer as a contract deposit and an additional $22,500 as a down payment on a cooperative apartment in Bayside that she was selling. It is further alleged that the buyer’s application was subsequently denied by the cooperative board and that when she tried to get her deposit back Taveras refused to return the money.

• In addition, according to the indictment, Taveras is accused of ripping off three clients [...] The indictment charges that Taveras failed to release $10,000 of the client’s money that was held in escrow. Another client was allegedly bilked of $40,000 stemming from the sale of commercial property. Taveras is accused of stealing $34,142 from a third client who allegedly retained her to represent him in connection with a divorce proceeding and a refinancing of his home.

For the Queens DA press release, see D.A. Brown: Disbarred Attorney Indicted On Charges Of Raiding Escrow Accounts And Stealing Over $100,000 From Clients. sneaky slick escrow agents gamma

Attorney Cops Guilty Plea, Disbarred After Being Nabbed Taking Kid-Client Escrow Cash To Avoid Foreclosure

In Charleston, West Virginia, The Charleston Gazette reports:

• [O]n Nov. 12, the justices [of the West Virginia Supreme Court] revoked the law license of Anthony Tatano, a Marlinton lawyer who was admitted to the bar in 1999. In September, Tatano pleaded guilty to two counts of embezzlement by misuse of attorney in Pocahontas County Magistrate Court, according to court documents. In a sworn statement before an investigative panel, Tatano admitted he took funds from the accounts of two juvenile clients to avoid foreclosure on his house. [...] Tatano said he has since paid the money back.

For the story, see 3 lawyers have licenses revoked or annulled by Supreme Court. sneaky slick escrow agents gamma