City Kicks 53 Residents Out Of Residential Hotel In Foreclosure As Power Shutoff Creates Fire Hazard; At Least 24 Kids Among Those Getting The Boot

In St. Petersburg, Florida, the St. Petersburg Times reports:

• When the electricity in their residential hotel was turned off the morning before Thanksgiving, Mary Mix and her three children scraped together money to buy candles. During the next few nights — some of the most frigid this winter — they piled under blankets to stay warm.

• Then on Monday, city officials shuttered the hotel that Mix and more than a dozen other families, including at least 24 children, had called home. City officials said the lack of electricity [...] created a fire hazard. The hotel's water also was about to be shut off. Officials said the hotel owners owe $90,000 in back utility bills.

• A total of 53 people were forced out. They had to be gone by 5 p.m. Wednesday. Most of the last dozen or so families to leave were single mothers and their kids. Instead of focusing on preparing for the holidays, they were scrambling to find a new place to live.

For more, see No heat, no lights, then no home in St. Petersburg.

For other posts involving the problems tenants face in homes in foreclosure, go here, go here, go here, go here, go here, and go here. ThetaTenantRentSkimming

Unconventional Miami-Area Housing Activist Comes Up With "Bailout" Plan; Gets Homeless Off Streets By Moving Them Into Vacant Foreclosed Homes

In Miami, Florida, The Associated Press reports:

• [Max] Rameau is an activist who has been executing a bailout plan of his own around Miami's empty streets: He is helping homeless people illegally move into foreclosed homes. ''We're matching homeless people with people-less homes,'' he said with a grin.

• Rameau and a group of like-minded advocates formed Take Back the Land, which also helps the new ''tenants'' with secondhand furniture, cleaning supplies and yard upkeep. So far, he has moved six families into foreclosed homes and has nine on a waiting list.

For more, see Miami Activist Moves People Into Foreclosed Houses.

For other media reports on this story, see:

• Miami New Times: Squatters Fight for Rights (A homeless mom wants her stuff back) (Thousands of homes in South Florida are in foreclosure, squatters are taking up residence, and when said squatters get booted, they demand a proper eviction notice),

• WPLG-TV Channel 10: Homeless Woman Takes Shelter In Vacant House (Housing Advocate Breaks Into House, Moves Woman In). Go here for the WPLG-TV Channel 10 video.

Thanks to attorney Donald Marritz of Regional Housing Legal Services in Pennsylvania for the heads up on the Associated Press story.

Go here for posts on squatters moving into vacant homes, foreclosures. squatter foreclosure zebra

Detroit Firefighter Loses Life Battling Arson Blaze In Abandoned House

In Detroit, Michigan, the Detroit Free Press recently reported:

• [Walter] Harris, 38, of Sterling Heights was killed Nov. 15 when a roof collapsed on him as he fought a fire at [an] abandoned house. The father of six was a 17-year veteran of the department and spent his career at the station on East Grand Boulevard that houses Rescue Squad 3 and Engine Co. 23.

For more, see At house where firefighter Walter Harris died, ex-cop's sign protests arson.

See also:

• Detroit Free Press: The fire was nearly gone, but then came the crash,
• The Detroit News: Site of fatal fire to be demolished (Building where firefighter died is one of many in Detroit to draw complaints). ArsonForeclosureAlpha

Group Of Teenaged Arsonists Suspected In Central Florida Serial Torchings Of Vacant Homes

From Zellwood, Florida, Central Florida media outlets have reported:

• A serial arsonist has residents in one Orange County neighborhood living in fear. Two overnight fires near Round Lake Road in the Zellwood area were set on purpose and it's the same area where Eyewitness News reported someone set five fires last month. Investigators do believe the fires are connected. [...] Fire investigators say an arsonist is torching homes in the Zellwood area. The two home fires overnight were started in less than a 10-minute time period. Both homes were vacant and one was in foreclosure. See Serial Arsonist Has Neighborhood On Edge.

• Orange County Fire Rescue officials believe a group of teens set two homes on fire in Zellwood overnight Monday. [... F]or the past month, five other abandoned houses have also been set up in flames. The [fire] Marshals office says they have leads indicating it’s a group of neighborhood teens setting the fires just for fun. See Fire officials believe teens set Zellwood homes on fire.

For other stories on fires & foreclosures, go here, go here, go here, go here, and go here. ArsonForeclosureAlpha

Long Island Attorneys Volunteer Help To Poor In Landlord/Tenant Court

In Hempstead, New York, Long Island Business News reports:

• The second floor of the Nassau County District Courthouse in Hempstead is ground zero for the mortgage and foreclosure crisis on Long Island. That’s where Judge Scott Fargrieve presides over landlord/tenant court, typically the final step for evictions, disputes and post-foreclosure proceedings.

• It is also where the Nassau/Suffolk Law Services Committee’s Volunteer Lawyers Project is set up with a stream of attorneys who stop by each day to help those who can’t afford the monthly note, never mind the attorney. [...] Volunteer lawyers [...] receive Continuing Legal Education credits for the pro-bono time they log with the project.

For more, see Volunteer lawyers work to ease foreclosure pain.

In New York City, go here for Volunteer Lawyers Project (Housing).

More On The Continuing Squeeze On Non-Profit Legal Aid Programs

The squeeze on the country's non-profit law firms continues as demand for services increases while funding hits the skids.

• Federal funds rate fiasco for legal aid: Three of Ohio’s six legal aid groups could be forced to cut their staffs next year because of measures the Federal Reserve has taken to shore up the nation’s struggling economy and keep credit flowing.

• Free legal help for low-income residents drying up: 20,000 low-income residents of Massachusetts will lose their free legal help at a time when demand is growing. The funds from interest-bearing accounts for client deposits are drying up, forcing legal aid groups not only in Massachusetts, but Connecticut, New Jersey, Pennsylvania and the District of Columbia to cut back on the number of residents who receive free legal services.

• Nonprofit Legal Agency Sees Spike In Calls For Help (Agency Says Economic Troubles Hurting Low-Income People): Legal Action of Wisconsin Inc. provides free legal help for the poor from six offices statewide. It says its office phones have been ringing off the hook as more people seek free legal help getting food stamps, medical care or housing support, including avoiding eviction and, more recently, home foreclosure. Requests for services has increased by more than 75 percent over the last year.

• Without funding, non-profit group's free legal services in jeopardy: Connecticut Legal Services funding is tied to real estate market, with interest-bearing accounts used to temporarily hold money for people purchasing property providing two-thirds of the organization's funding. The accounts are called Interest on Lawyer Trust Accounts (IOLTA) accounts, and with the downturn in the real estate market, those funds have dwindled. Plus, interest rates on the accounts have decreased, so it has been a "double whammy" for the nearly 40-year-old provider, CLS Executive Director Steven Eppler-Epstein said. Last year, he said, the organization reaped $20 million from IOLTA accounts. This year, the organization gained about $4 million from the accounts. See also Legal Assistance For Poor Takes A Hit.

• Lawyers urged to help the poor (Chief justice says too many forced to tackle legal troubles on their own): The state's top judges are asking every attorney in the state to help in the face of a mounting crisis in the legal aid system. Tennessee Supreme Court Chief Justice Janice Holder sounded the alarm Friday, saying only one in five low-income Tennesseans will get the legal assistance they need. This new initiative comes at the urging of the Tennessee Bar Association, Legal Services and a raft of other legal groups to call for more access to civil legal aid for those Tennesseans who need it most. More than 1 million Tennesseans live in poverty who are eligible for civil legal aid, but there are just 75 legal aid attorneys in the entire state, one for every 13,000 people.

Miscellaneous Stories Connected To Ongoing Foreclosure Mess

The following links are to an assortment of stories that caught my eye that may be viewed as small, peripheral pieces of the "foreclosure mess" puzzle:

• Arson for copper: This is what it's come to?: People are burning down buildings in New Bedford, Massachusetts to get at the valuable copper wire inside their walls. Reportedly, there are now more than 300 abandoned buildings in the city sitting in various stages of disrepair - three-story time bombs, ticking away right next door to their low-income neighbors, poor people trying to scratch out a living. It's not any wonder that Mayor Scott Lang is terrified about literally seeing his city go up in flames.

• Corpse in 'old lady clothes' found inside North Hollywood home (Police believe it had been there at least a year): Los Angeles police find the mummified remains of the 80+ year old previous owner of a now-foreclosed home that was stuffed halfway to the ceiling with trash and inhabited by a 48-year-old man (the deceased owner's son), 26 cats, three opossums and a raccoon.

• Family Worries About Losing Foster Child During Foreclosure: Family in foreclosure worries what might happen to an 11-year old foster child living with them if they lose the house. Reportedly, the local Department of Social Services says the state does not have any rules specifically regarding foreclosures and foster care.

• Code Enforcement Overwhelmed, Asks For Additional Funding: Vacant, abandoned homes in foreclosure are draining Orange County, Florida code enforcement budget. Says it needs $1 million more to handle the 17,000 homes in foreclosure.

• Dogs, cats need homes for the holidays: The Gulf Coast Humane Society in Ft. Myers, Florida has a four-month wait list of people wanting to surrender their pets. Many people on the list are in foreclosure, and choose not to wait. "We have a lot of animals that just get tied to the gates. I mean the number has tripled from last year," says one Humane Society employee.

• The Condo Crunch (Sales Are Slow, Prices Are Falling, Dues Are Overdue. How Are Associations Coping?): The challenges facing Washington D.C. condos are mounting. Sales prices are falling and are not expected to stabilize soon. The number of condo owners not paying their association fees is rising along with foreclosure rates, creating a budget crunch weighing down many communities.

• Ogden home fire ruled suspicious: A suspicious fire in a vacant foreclosed home sustained approximately $150,000 in damages. The interior had just undergone repairs for recent vandalism. Neighbors' homes on each side of the house received a total of about $20,000 in damage due to radiant heat and melting vinyl siding.

• Cold Weather Leads To More Arsons: Cincinnati's fire department says the cold weather is bringing more arsons in vacant homes. Fire investigators are asking you to keep an eye on abandoned homes in your neighborhood before a firebug strikes. The Cincinnati Fire Department says arsons in vacant homes around the city is a big problem. Neighborhood leaders say the foreclosure crisis has also played a big role in the number of arsons in vacant homes.

• Firefighters Battle Fires In Foreclosed Homes: Firefighters are working hard to protect neighborhoods with abandoned homes. Like many communities, Lynn, Massachusetts has seen a surge of foreclosed homes, and fire officials want to make sure they don't become a hazard.

• Family Goes From Foreclosure To Skid Row: Andy Bale, the director of Skid Row's Union Mission in Los Angeles, has never seen this before: In just the last few weeks, he has admitted a half-dozen two-parent families, many of who have lost their homes to foreclosure. Bale says the face of Skid Row's homeless is changing quickly.

• Foreclosure looms for owners of Duncanville's Cherry Pit swingers club: The owners of Duncanville's Cherry Pit swingers club face foreclosure on the home where they have hosted sex parties for hundreds of Dallas-area swingers. The foreclosure hints at the owners' financial difficulties stemming from a slew of legal trouble that began last year when the city of Duncanville approved an ordinance outlawing the sex club operation. ArsonForeclosureAlpha

NYC Prosecutors Call For System Changes To Address Deed Theft After Empire State Building "Heist" By Reporter For Local Paper

In New York City, The Daily News reports:

• The city's top prosecutors called for sweeping changes in the system that let a Daily News reporter "steal" the Empire State building with a fake deed (see: It took 90 minutes for Daily News to 'steal' the Empire State Building). The News' "theft" of the $2 billion Fifth Ave. icon was carried out to reveal a gaping loophole in the city's system for recording property transactions. The loophole: Clerks in the city office of the register are not required to verify information on deeds and mortgages.

For more, see Daily News probe revealing scandalous property loopholes has prosecutors urging change.

Fresno Cops Foil Fake Landlord Rent Scam; Charge Suspect With Renting Vacant Homes In Foreclosure Belonging To Others

In Fresno, California, The Fresno Bee reports:

• An elaborate scam taking advantage of the mortgage crisis unraveled, authorities say, when Kristen Ables found another family living in her Fresno house. "It was a mixture of disbelief and anger" that she felt on learning that she had been victimized, Ables said Wednesday as Fresno police announced the arrest of Sam Haley, 66.

***

• Police allege that Haley, who they said lost his real estate license in 1979 because of fraudulent business practices, carried out the scam at least 13 times -- and was likely to keep doing it if the unexpected visit by Ables hadn't uncovered the scheme.

• Fresno police detective Donnie Dinnell uncovered evidence at Haley's home and business, Capital Investments Inc., that indicated he had people lined up to rent 19 other houses, police Chief Jerry Dyer said. Dinnell also found evidence that Haley had identified up to 126 other homes that he could possibly use in the scheme, Dyer said.

Reportedly, the cops said that Haley pocketed $26,000 over the seven months he allegedly ran the scam and faces felony theft charges.

For more, see Fresno housing scam uncovered (Police say man rented homes to victims who didn't know he was not the owner).

Go here, go here, and go here for posts on phony landlord rent scams. PhonyLandlordScamZeta

Upstate NY Couple Forced Into Court To Stop Lender's Collection Attempts, Foreclosure Threats On Paid-Off Mortgage

In Voorheesville, New York, WNYT-TV Channel 13 reports:

• Georgianne Crabill's phone wouldn't stop ringing. "At work, they were relentless! They wouldn't let me off the phone!" Debt collectors demanded that she and her husband Bill - pay up.

• The Crabills had re-financed their home, and CitiFinancial insisted they owed nearly $20,000 on their original mortgage. Bill and Georgianne insisted they didn't owe it. They were threatened with foreclosure.

***

• For the Crabills, the calls went on for years. The stress was nearly unbearable. But they had one thing in their favor: they did not owe the debt CitiFinancial was trying to collect. They fought back in court. "Finally after we counter-sued them, they admitted they they had done something wrong and figured it out and cleared everything up. But if we hadn't done that, we wouldn't have our house today."

For more, see When Debt Collectors Go to the Extreme.

Florida Developers Cop Plea To Grand Theft Charges; Accused Of Pocketing $475K Of Customer Cash, Failing To Deliver

In Vero Beach, Florida, TC Palm reports:

• Two developers of an unfinished subdivision north of Vero Beach pleaded no contest to criminal charges of first-degree grand theft of $475,000 in deposits from customers at the Indian River Courthouse on Wednesday.

• Developer Richard Rendina of Palm Beach Gardens agreed to pay $80,000 in restitution in addition to serving five years probation. [...] Stephen Siegel of Boca Raton agreed to pay $388,936 in restitution — to be paid out of his cash bond of $500,000 — in addition to five years probation.

***

• Construction of Eagle Trace Phase II was stopped last year, leaving empty lots and unfinished concrete block walls. Prosecutors allege they improperly took deposits from 11 customers who paid on homes, according to court files.

For more, see Eagle Trace developers plead no contest to grand theft charges, agree to pay restitution.

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

More On Abandoned Unfinished Residential Developments

The problem of abandoned residential developments languishing in an unfinished (and unwanted) state is described in these two Florida media reports:

• Central Florida: Some New FL Subdvisions are Awful Lonely (A couple hundred unfinished housing developments pockmark the region with empty lots and paved roads leading to nowhere. The construction crews and their trucks are gone. The collapsed housing and credit markets have left few new-home buyers. County property appraisers in Seminole, Orange, Osceola, Volusia and Lake reported 155,835 vacant residential lots this year. Most are lots in new subdivisions approved during the peak of the housing boom in late 2005 and early 2006.),

• Palm Beach County, FL: Even luxury real estate projects falling into foreclosure (Receivers are becoming an increasing presence in Palm Beach County housing communities. Appointed by a judge, they help keep developments functioning while lenders and developers duke out their legal battles in court.).

No "Miracle On 34th Street" As Empire State Building Victimized By "Deed Theft;" Reporter Easily "Swipes" Historic Midtown NYC Edifice Valued At $2B

On 34th Street in New York City, the New York Daily News reports:

• In one of the biggest heists in American history, the Daily News "stole" the $2 billion Empire State Building. And it wasn't that hard.

• The News swiped the 102-story Art Deco skyscraper by drawing up a batch of bogus documents, making a fake notary stamp and filing paperwork with the city to transfer the deed to the property. Some of the information was laughable: Original "King Kong" star Fay Wray is listed as a witness and the notary shared a name with bank robber Willie Sutton.

• The massive ripoff illustrates a gaping loophole in the city's system for recording deeds, mortgages and other transactions.

***

• Of course, stealing the Empire State Building wouldn't go unnoticed for long, but it shows how easy it is for con artists to swipe more modest buildings right out from under their owners. Armed with a fraudulent deed, they can take out big mortgages and disappear, leaving a mess for property owners, banks and bureaucrats.

Reportedly, the Daily News returned the storied structure back to its rightful owners the day after the heist, which they pulled off on Monday.

For more, see It took 90 minutes for Daily News to 'steal' the Empire State Building.

For a copy of the deed to the stolen structure, see:

• Deed of Empire State Building sale (Page 1),
• Deed of Empire State Building sale (page 2),
• Fake notary stamp. DeedTheftAlpha

Use Of Lease Option Arrangement As Exit Strategy For Overextended Landlords Looking To Stiff Mortgage Lender & Pocket Some Walking Away Cash Continues

In Washoe County, Nevada, KOLO-TV Channel 8 reports:

• A Sparks couple is just a step away from being homeless, after they say they were "ripped off" by their landlord. Shanna Mayer and Clinton Conroy leased a home in hopes of buying it ... but it turns out, the bank was already a step ahead.

***

• Mayer and Conroy moved their family to Sparks in June. When they signed a lease, with an option to buy contract on a Wingfield Springs home, they thought the deal was too good to be true. "Then we came back here and signed a lease agreement and everything. He shook our hands and said 'congratulations on the purchase of your new home," said Mayer.

• But nearly $15,000 dollars later in down payment fees and rent, Mayer says she received a foreclosure notice on the doorstep of her dream house. That's when she confronted the homeowner.

***

• When [KOLO-TV Channel 8] looked up Mayer's home, it turns out, the seller is headed to foreclosure on Mayer's home, plus 16 other properties he owns in the Reno-Sparks area.

For more, see Sparks Couple is "Ripped Off" By Landlord.

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

Missouri Couple Sues "Contract For Deed" Operator For Allowing Home To Fall Into Foreclosure

In Republic, Missouri, the Springfield News Leader reports:

• A Republic couple who made monthly payments but nearly lost their home is suing Greenleaf Cos., accusing the Springfield company of breach of contract and questionable business practices.

***

• In the lawsuit, [David and Susan] Foster say they bought a house from Greenleaf in August 2007 for about $252,000 on a contract for deed. The house, located [...] in Republic, belongs to Talya Finn of Marionville.

• As the middleman, Greenleaf was expected to collect money from the Fosters and pay Finn enough to cover her mortgage payments. But, without enough income, Greenleaf officials have said the company could not pay Finn and other investors.

• In their petition, the Fosters say they made all the payments as agreed on time but had their house threatened with foreclosure when Greenleaf failed to ensure the loan on the house was properly paid. The Fosters say foreclosure proceedings were initiated but canceled when Greenleaf "made arrangements to remedy the deficiency."

Reportedly, the Fosters are seeking punitive damages of at least $100,000 and a release from their contract.

For more, see Couple takes Greenleaf to court (Lawsuit questions company's real estate program).

For Greenleaf's side of the story, see Greenleaf partner describes homeowner lawsuit as ‘frivolous’ (Greenleaf partner Scott Dasal said the story and other recent Greenleaf stories have hurt his business, because more and more Greenleaf clients began to question whether they should pay. “They have come out of the woodwork, and people don’t want to pay,” he said).

For story update (12-30-08), see Republic couple drops lawsuit against Greenleaf:

• [D]avid and Susan Foster of Republic has filed a voluntary dismissal with prejudice, which would allow them to sue the defendants in the future. [...] Foreclosure proceedings were initiated, but they were cancelled when Greenleaf “made arrangements to remedy the deficiency,” the Fosters said.

Go here for other "contract for deed" problems involving Greenleaf 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 Arkansas

Trump "Convinces" Deutsche Bank To Fork Over $13.2M In Construction Cash To Finish Off Chicago Skyscraper

Buried in a recent Between The Bricks column in the New York Post is this blurb on the recent $3 billion lawsuit filed by Donald Trump against Deutsche Bank, in which (according to a recent Wall Street Journal article) the latter was accused of, among other things, "compromis[ing] the senior construction loan by selling pieces off to so many institutions, banks, junk bond firms, and virtually anybody that seemed to come along, that the lending group is unable to come to a consensus on how to deal with the matter":

• In one closely-watched bank stand-off, Donald Trump just got a worried Deutsche Bank to blink - and fork over $13.2 million in construction funds towards his soon to be completed spectacular Chicago hotel and condo tower.

• The lender filed a $40 million suit against him after he slapped them with his own $3 billion lawsuit. Trump claims they damaged his brand by ceasing funding after he invoked his specially worded "force-majeure" clause due to events and circumstances that "are not reasonably" within his control.

Source: Banks Threaten Foreclosures.

In a related story, see The New York Times: Trump Sees Act of God in Recession.

Rhode Island Closing Agent Cops Plea To Pocketing Escrow Cash Intended For Payoff Of Existing Mortgage Loans; Title Underwriter Takes $1.3M Hit

In Providence, Rhode Island, the Office of the U.S Attorney announced:

• Angela Raposa, who owned Title America Closing Services, pleaded guilty today to a federal fraud charge, admitting that she used about $1.3 million from her company’s escrow account to pay for personal expenses.

***

• Proceeds of real estate transactions were deposited into the escrow account and were supposed to be used to be disbursed at real estate closings, primarily to pay off existing mortgages. Stewart Title served as an underwriter for Title America and discovered Raposa’s fraudulent scheme in February 2007. As the underwriter, Stewart Title had to pay off mortgages totaling $1,301,826 from five real estate transactions.

For the press release, see Title company president admits $1.3 million fraud.

Go here, Go here, Go here, and Go here for other stories of trust account / escrow account theft of funds. EscrowRipOffAlpha

Environmental Issues Arising At Abandoned Unfinished Developments; Insolvent Builders, Lenders Afraid To Foreclose Both Disclaim Responsibility

In Cartersville, Georgia, The Gainseville Times reports:

• The foreclosure crisis has been devastating to the U.S. economy, and now it appears the environment is suffering as well. Bert Langley, manager of the Georgia Environmental Protection Division’s Mountain District in Cartersville, said he’s seen numerous cases where a developer or builder abandoned a property, leaving no one to monitor erosion control at the site.

• "It’s a situation we’ve never dealt with before," he said. "We have cases where massive amounts of sediment are going into streams."

***

• Environmental attorney Jimmy Kirkland said the situation is creating yet another headache for banks. "It’s an issue that all lenders are facing now, having to take back properties that are partially constructed," he said. "Banks aren’t accustomed to dealing with environmental permits. They need legal advice, but they also need assistance from consultants on developing plans for stormwater and erosion and sedimentation control." [...] Environmental problems occur when a developer clears and grades a property, but then abandons it before most of the construction is done.

***

• [Senior soil erosion inspector for Forsyth County Simon] Wilkes said the owners of those properties have claimed to be bankrupt but have not entered into foreclosure. A site only becomes the bank’s responsibility once it is foreclosed on. "We can’t get the developers or the banks to go out and take care of the property," said Wilkes. "(The banks) refuse to foreclose. They’re just letting it sit in limbo. They don’t want to spend the money to stabilize it."

For more, see Foreclosures leave erosion problems (Finding responsible party for damage not always easy).

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

One Week "Moratorium" On Ft. Lauderdale-Area Foreclosure Sales As Busted Water Pipe Floods Courthouse, Forcing Facility Shutdown

In Fort Lauderdale, Florida, the South Florida Sun Sentinel reports:

• The Broward County Courthouse will be closed for most purposes through Friday after severe flooding knocked out the phone system and soaked reams of legal papers, court officials decided [Tuesday].

***

• On Sunday evening, a 2-inch pipe burst in the Clerk of Court's Office, flooding the first and second floors of the courthouse. The burst blew a hole in the wall and ruined the building's communications center and thousands of court files.

For more, see Broward County Courthouse closed through Friday.

NYC Lawmakers Urged To Establish Right To Counsel In Eviction, Foreclosure Proceedings

In a letter urging the City Council of New York City to pass laws which would establish a right to counsel in eviction and foreclosure proceedings for low income persons, Ann B. Lesk, President of the New York County Lawyers' Association, reminds us of the inherent unfairness in the results emanating from a judicial system where only one party is represented by counsel:

• [T]he backbone of our judicial system is the concept that adversarial proceedings produce just results. For an indigent person facing eviction or foreclosure, this is a very theoretical proposition. Numerous studies have documented the unsurprising fact that having a lawyer improves the outcome for a litigant. In [New York City] Housing Court, 90 percent of tenants are not represented by a lawyer (in contrast, less than 10 percent of landlords are unrepresented). Unrepresented litigants face a complex set of procedural and substantive rules. They may have defenses of which they are not aware.

For more, see Don't Just Pass The Senior Citizen Right To Counsel Bill - Expand It.

Attorneys At Upcoming St. Paul Legal Clinics To Provide Free Mortgage Document Review For Homeowners Facing Foreclosure

In St. Paul, Minnesota, MinnPost.com reports:

• Three free legal clinics for homeowners worried about foreclosure will be held in St. Paul. Homeowners can have their mortgage documents and related foreclosure notices reviewed by an attorney for free and get connected to a housing counselor. Those attending should bring all of the mortgage documents they received when buying the house and any related foreclosure notices.

The clinics will be held:

• Thursday, 6 to 8 p.m., at the Summit-University Planning Council, 665 Selby Ave., St. Paul,
• Saturday, 1 to 3 p.m., and Jan. 29, 6 to 8 p.m., at the Greater Frogtown Community Development Corp., 533 Dale St., St. Paul.

For contact information, see Free legal clinics offer help to homeowners worried about foreclosure.

Lenders Warming To Idea Of Bulk Sales As Way To Unload Foreclosed Inventory

The Wall Street Journal reports:

• As the glut of foreclosed homes swells, banks and other lenders are starting to warm to the idea of selling some of the homes in bulk to investors, a departure from the practice of selling homes one at a time.

• For the past year, investors have been eager to buy large numbers of homes from lenders at knockdown prices. Lenders have generally resisted that idea, but now some are trying it out on a small scale.

For more, see Lenders Tiptoe Into Bulk Sales (Glut of Foreclosed Homes Spurs Some Trial Runs) (may require subscription; if no subscription, go here - then click link for story).

Non Profit Lawyers Save Day For 80+ Year Old New Mexico Couple Facing Foreclosure Over $2 In Late Payments

In Albuquerque, New Mexico, the Albuquerque Journal reports:

• Dixie and Paul Williams have much to be thankful for -- to wit, not being thrown out of their South Valley home for $2 in late mortgage payments. And they're thankful to the lawyers at the Senior Citizens' Law Office who helped make that happen.

• Senior Citizens law office executive director Angelica Allen said that an order dismissing the foreclosure action against the couple, who are in their 80s and not in the best of health, has been filed in state district court. This time, she said the bank accepted the $4 in mortgage fees that it had previously rejected as payment.

***

• The couple, who live on Social Security, had pledged their house as collateral on a Small Business Administration loan in the 1970s and arranged an extension with a new mortgage payment of $1 a year when Paul Williams became ill. The terms of the legal arrangement say the house will revert to SBA or its successor bank upon the deaths of the Williams.

• The paperwork had changed hands, and the Williams never got any notice of where to send the $1 mortgage payment, legal documents said. The new mortgage holder filed a foreclosure lawsuit against the couple earlier this year when it failed to receive the $1 payments.

For more, see Couple Won't Lose Home Over $2: Order Dismisses Foreclosure Action (subscription required; if no subscription, try here).

Shorthanded Legal Aid Offices Bursting At The Seams With Foreclosure Defense Cases

National Public Radio reports:

• Everyone accused of a crime is entitled to a lawyer, whether they can afford one or not. But in civil cases, such as home foreclosures, there is no right to an attorney. Legal aid attorneys say some people being kicked out of their homes might have been able to stay if they'd had legal help — help that isn't there for everyone.

***

• Nationally, "half the people coming to the office at least are being turned away at the door," says Don Saunders, director of civil legal services at the National Legal Aid & Defender Association. That statistic does not count those who never make it to legal aid offices.

• "The other side has a lawyer," Saunders says. "The bank and the foreclosure process is being brought by a lawyer, and the playing field is clearly not a level one."

For more, see Foreclosures Overwhelm Legal Aid Programs.

B'klyn Foreclosure Sale Set Aside, Judgment Vacated As Process Server Screw-Up Leaves Court With No Personal Jurisdiction Over Defaulting House Owner

A case decided last month in a Brooklyn, New York trial court serves as a valuable reminder to defaulting homeowners (and their attorneys) that, in cases where a foreclosure judgment has already been entered (and even if a foreclosure sale has already taken place), it is still possible to void the sale and the judgment if the process server failed to properly serve the property owner with the lawsuit upon commencement of the legal action.(1)

In this case, service of process upon the defaulting property owner was purportedly effected by resorting to what is referred to as "nail and mail service" (a form of substituted service that apparently is still allowed in New York) whereby the process server affixes one true copy of the the summons and foreclosure lawsuit on the door of the property owner's "actual dwelling place or usual place of abode." Service is completed when a second true copy is mailed to the property owner.

Unfortunately for the process server and the foreclosing lender, the two locations at which the nail and mail service was attempted (at the house that was the subject of the foreclosure action and at a second location) were not the property owner's "actual dwelling place or usual place of abode." In addition, the three affidavits of service that were filed in court by the process server relating to service on the delinquent property owner conflicted with each other.

The property owner (through counsel) presented an unrebutted affidavit to the court stating that she never lived at either of the two locations, and, for an 18 year period that included the dates on which service was purportedly attempted, she lived at another address.

In reaching his decision setting aside the foreclosure sale and vacating the judgment, Kings County Supreme Court Justice Martin Schneier reminds us of this basic, fundamental precept of law:

• It is "axiomatic that the failure to serve process in an action leaves the court without personal jurisdiction over the defendant, and all subsequent proceedings are thereby rendered null and void" (McMullen v. Arnone, 79 AD2d 496, 499 [2d Dept. 1981]), irrespective of the question of merit. [emphasis added in bold]

For the decision, see HSBC Bank USA, N.A. v Fleurimond, 2008 NY Slip Op 52320(U), Sup Ct, Kings County (November 18, 2008).

Go here and go here for other posts on foreclosures involving faulty notifications to property owners.

Go here for other posts on process server screw ups.

(1) As simple as serving a defendant in a lawsuit may appear to the unitiated, the statutes that apply (other than in cases where the process server actually hands an individual defendant the summons and complaint in a face to face encounter) can be somewhat nuanced (particularly when a corporate defendant is involved). It may be a good idea for foreclosure defense counsel to review the statutes regulating service of process and, (in my view) more importantly, take the time to familiarize oneself with some of the case law applying the service of process statutes to become aware of the types of facts and circumstances that have resulted in a finding of faulty service. Such instances can open up opportunities for counsel to void a foreclosure judgment and, where a foreclosure sale has already taken place, void said sale, thereby forcing the foreclosing lender to go back to "square one" of the legal action and start over again.

In my humble judgment, process servers screw up (either innocently, or intentionally - ie. "sewer service") more often than many may think. Accordingly, the careful scrutiny of the process server's actions (reviewing the affidavits of service for errors & inconsistencies, eliciting oral testimony under oath from the process server) is something deserving of serious consideration. SewerServiceAlpha foreclosure faulty notice ScrewUpProcessServing

Retired Maine Attorney Joins Fight Against Foreclosures; Volunteers Services With Local Legal Aid Program

In Portland, Maine, the Morning Sentinel reports:

• When Maine National Bank collapsed during the recession of the early 1990s, Tom Cox's job was to collect money from businesses that had borrowed from the failed bank.

***

• Nearly two decades later, as Mainers face a new economic crisis, the 64-year-old retired lawyer has emerged on the flip side of debt collection. Cox volunteers several hours each week in a program called Maine Attorneys Saving Homes. It was developed over the past year within the Volunteer Lawyers Project, a division of Pine Tree Legal Assistance. The program provides free legal help to individuals and families on the brink of foreclosure.

***

• This past spring, just as the Maine Attorneys Saving Homes program was getting started, Cox made a telephone call and offered to help. "It felt like a gift from heaven," said Juliet Holmes-Smith, director of the Volunteer Lawyers Project.

• Holmes-Smith had about 20 lawyers who had taken preliminary training on foreclosure and were ready to take some cases. But the program didn't have anyone with the expertise of Cox. And it didn't have a volunteer willing to come into the office, analyze the case files and farm them out to the lawyers across the state. Cox stepped easily into that role.

For more, see Volunteer lawyer helping save homes (Group's members negotiate new terms, go to court for homeowners caught by economic woes).

More On Hedge Fund Suit Against Countrywide Over $8.4B Bank Of America Loan Modification Settlement

For those interested in reviewing the lawsuit filed in this matter, see:

• New York State Supreme Court (New York County) - Index # 650474-2008: Greenwich Financial Services Distressed Mortgage Fund 3, LLC v. Countrywide Financial Corporation.

Go here for links to Exhibits A through G of the above lawsuit (be sure to type in the letters you see in the picture, then click submit - you'll be taken directly to the links):

• Exhibits A & B - representative examples of the pooling & servicing agreements involved;
• Exhibits C & D - lawsuits against Countrywide filed by California & Illinois;
• Exhibit E - Multistate Settlement Term Sheet regarding the settlement of the accusations of the Attorneys General against Countrywide;
• Exhibit F & G - copies of the California and Illinois judgments.

For some of the media reports on this story, see:

• The Wall Street Journal: Mortgage-Bond Holders Get Voice (Greenwich Financial's William Frey Challenges Loan Servicers Like BofA) (subscription may be required; if no subscription, try here, then click link for story),
• The American Lawyer (at Law.com): Class Action Demands Countrywide Repay Hedge Funds for Losses,
• Bloomberg News: Countrywide Sued by Fund Over $8.4 Billion Loan Deal.

Hedge Fund Sues Countrywide Over $8.4B Bank Of America Loan Modification Settlement Of Predatory Lending Charges With State AGs

In New York City, Bloomberg News reports:

• Countrywide Financial Corp., the home lender acquired by Bank of America Corp., was sued by Greenwich Financial Services Fund over claims an agreement to reduce payments on mortgages by $8.4 billion would hurt investors.

• The hedge fund claims investors will be harmed by Bank of America’s settlement, reached on behalf of Countrywide, with 15 state attorneys general. The value of trusts that bought 400,000 mortgages will decline under the deal, the fund said.

• In the proposed class action, or group lawsuit, the Greenwich, Connecticut-based fund demands a declaration that “Countrywide must purchase at par every mortgage loan that it sold to any of the 374 securitization trusts,” David Grais, a lawyer for the fund said today in an e-mailed statement. Grais said Countrywide could owe the trusts $80 billion.

For more, see Countrywide Sued by Fund Over $8.4 Billion Loan Deal.

See also:

1) The Wall Street Journal: Mortgage-Bond Holders Get Voice (Greenwich Financial's William Frey Challenges Loan Servicers Like BofA) (subscription may be required; if no subscription, try here, then click link for story):

• [T]he new lawsuit, filed in New York state court, doesn't take issue with the actual settlement but focuses instead on who should bear the costs. Noting that the attorneys general accused Countrywide of "widespread predatory lending," the lawsuit alleges that Countrywide plans "to pass most or all" of the cost of the settlement to investors.

2) The American Lawyer (at Law.com): Class Action Demands Countrywide Repay Hedge Funds for Losses.

3) Summons & Complaint: Greenwich Financial Services Distressed Mortgage Fund 3, LLC v. Countrywide Financial Corporation. MortgageServicingIssuesAlpha

Alleged Hampton Roads Equity Stripping Scam Operation Leaves Homeowners Out On The Street, Straw Buyers Holding The Bag

In Hampton Roads, Virginia, The Virginian Pilot reports:

• [T]he alleged scammers presented themselves as saviors of financially distressed - often first-time - homeowners, promising to repair their credit and save their homes. Instead, they recruited straw buyers to purchase the properties - in the process taking out bigger mortgages - and walked away with the proceeds. That left two classes of victims in the dust: dispossessed homeowners and empty-handed straw buyers stuck with inflated mortgages.

***

• The figure at the center of the operation [...] is Shanita Lacy, owner of a Virginia Beach-based company called Clean Slate Financial Services. Settlement documents indicate that she pulled out more than $750,000 in equity from the nine properties identified so far.

For more, see Deals with Beach company put some owners out of homes.

For story update (12-5-08), see More report losing homes to 'credit repair' deals.

Investigative Report Reveals Blight-Inducing Tampa House Flipping Operation; 35 Homes Ended Up In Foreclosure (And Counting)

In Tampa, Florida, an investigative report by the St. Petersburg Times describes an apparent blight-causing, straw buyer, house flipping operation involving what it refers to as "a constellation of 90 homes stretching across Tampa, all bought and sold in the past four years by a 34-year-old tattoo parlor owner."

• Most of the homes Sang-Min Kim [aka Sonny Kim] sold are empty now. Many have code violations, and are clustered in impoverished neighborhoods such as Belmont Heights and Sulphur Springs.

• The trail of foreclosures and blight is lined with the bad mortgages approved or assigned by Wachovia, Washington Mutual, Bank of America, National City Bank, Lehman Brothers, Fannie Mae, Freddie Mac and Wells Fargo.

***

• Dissect any of the 35 sales involving homes that ended up in foreclosure after they were sold by Sonny Kim, and it's hard to believe that lenders made any attempt to verify anything.

Reportedly, Sonny Kim politely declined any comment for this story.

For more, see A case study in housing collapse.

Washington State Victim Of Alleged Sale Leaseback Foreclosure Rescue Scam Goes To Court To Save Home Of 35 Years

In Bellevue, Washington, KING-TV Channel 5 reports:

• Karen Handlin has been narrowly saved from eviction – for now. She’s filed a first-of-its-kind lawsuit in Western Washington to save the house her family has owned for 35 years. Handlin almost lost it to foreclosure and then, she says, to a company called Alternative Investors, which claimed it could rescue her from foreclosure.

For more, see Investigators: Alleged foreclosure rescue scam goes to court (read text) (watch KING5 video).

360 Unit Owners Dragged In As Defendants In Mechanics Lien Lawsuit Between Contractor, Condo Developer

In Northern Virginia, Washington Business Journal reports:

• As the sun set over Potomac Yard on Nov. 7, owners at The Eclipse condominium community came home to an unpleasant surprise. Nearly three-quarters of the units had a two-inch-thick stack of legal papers on their doorsteps, notifying the owners that every one of them was being pulled into a lawsuit between their developer and the construction company that built the 465-unit project just south of Reagan National Airport.

• The owners’ predicament is just one more wave in the economic undertow that has swept up banks, developers, builders and homeowners alike. For the owners — some of whom took a risk in buying a unit in a troubled building in the first place — the lawsuit was yet another setback.

For more, see Condo owners caught in crossfire of builder dispute. StiffingContractorsTheta

Ratings Agencies Face Charges Of Civil Rights Violations In Complaint Filed With HUD; Actions Allegedly Facilitated Discriminatory Subprime Lending

Syndicated real estate columnist Kenneth Harney recently reported:

• In what is apparently the first legal action of its kind, an association of community-based organizations has filed a federal civil rights complaint against two of the three largest Wall Street ratings agencies,(1) charging that their inflated ratings on subprime mortgage bonds disproportionately caused financial harm to African-American and Latino home buyers across the country.

• The complaint,(2) filed by the National Community Reinvestment Coalition, alleges that Moody's Investor Services and Fitch Ratings Ltd. enriched themselves by assigning high ratings to bonds backed by mortgages "that were designed to fail" because of "unfair payment terms and insufficient borrower income levels."

For more, see Civil rights complaint filed against rating agencies.

See also, NCRC press release: NCRC Files Civil Rights Complaint Against Fitch and Moody’s (Civil penalties and equitable relief sought for consumers and communities injured by rating agencies’ role in foreclosure crisis).

Go here, Go here, and go here for other posts on alleged race bias in real estate transactions.

(1) According to the column, a third rating agency with heavy involvement in the subprime boom, Standard & Poor's Corp., was not named in the complaint, but has been "in discussions" with the coalition, according to David Berenbaum, the group's executive vice president. If the discussions with S&P prove "unsatisfactory," he said, the company could be the subject of a separate action, the column states.

(2) The coalition reportedly filed its complaint with the Department of Housing and Urban Development's fair housing and equal opportunity unit. After a review, the department could either dismiss the allegations or refer the case to the Justice Department of the incoming Obama administration for litigation next year. If HUD fails to respond adequately, the coalition says it may file a federal civil lawsuit. DiscriminationPredatoryLendingAlpha

The Call For Home Mortgage Modification Rights In Bankruptcy Proceedings Continues

The Honorable J. Rich Leonard, a jurist who currently toils in the U.S. Bankruptcy Court for the Eastern District of North Carolina, recently wrote in The Washington Post advocating for a change in the cuurrent bankruptcy law to allow for the modification of troubled home mortgages in bankruptcy proceedings. In his article, Judge Leonard reminds us of the following:

• [H]omeowners are the only ones who cannot modify the terms of their secured debts in bankruptcy. Corporate America flocks to bankruptcy courts to do precisely this -- to restructure and reamortize loans whose conditions they find onerous or can no longer meet. Airlines are still flying and auto parts makers still operating because they have used this powerful tool of the bankruptcy process. Lehman Brothers will surely invoke it.

• But when the bankruptcy code was adopted in 1979, the mortgage industry persuaded Congress that its market was so tightly regulated and conservatively run that it should be exempted from the general bankruptcy rules permitting modification.

For more, see Give bankruptcy judges the power to alter mortgages.

For a similar position espoused by the Honorable Keith M. Lundin, a judge in the U.S. Bankruptcy Court in the Middle District of Tennessee, see:

• The Tennessean: Homeowner help may lie in bankruptcy courts (Chapter 13 modification could fend off foreclosures).

Plaintiffs In WaMu Suits May Be Left Holding The Bag; "Almost Nothing" Says FDIC Rep Referring To Assets Left In Receivership For Aggrieved Homeowners

In Seattle, Washington, a recent column in Seattle Weekly describes the problems homeowners suing Washington Mutual for violations of lending and consumer laws may face now that WaMu has been seized and put into receivership by the FDIC.

• [T]he search for redress is made even tougher by the amount of money left in the receivership—"almost nothing," according to Andrew Gray, [an] FDIC spokesperson.

• Some lawyers [...] are pushing on regardless, waiting to see what happens. Others are dropping their claims. "We're probably not going to go ahead in light of how treacherous and difficult that's going to be," says [a local attorney who filed a class-action suit against WaMu over what he claims were hidden and excessive fees].

For more, see Wronged by WaMu (After the crash, there’s little recourse).

Loan Modification Firms Drawing Attention From NY Feds, State AG

In New York City, Crain's New York Business reports:

• [W]ith citywide foreclosures up 50% over a year ago, some of the same bankers and brokers who sold unaffordable, subprime loans are now joining the rapidly growing ranks of mortgage modification consultants.

• While some members of what an online ad called one of the “fastest-growing job markets in the country” run legitimate businesses, housing advocates say many are taking people's money and doing little or nothing in return. The burgeoning industry has caught the attention of the FBI's New York office and the state attorney general.(1)

***

• Frequently, they ask homeowners for thousands of dollars up front, which is illegal in 12 states, including New York, unless the fee is made to a lawyer or nonprofit. As part of the sales pitch, homeowners are often advised to stop making mortgage payments,(2) putting their homes in further jeopardy of foreclosure.

For more, see Mortgage holders are marks (Loan modification specialists take money, do little in return).

(1) Other law enforcement agencies are zeroing in. The Illinois attorney general last month filed seven lawsuits against modification firms that failed to negotiate workouts for clients. The Colorado attorney general has filed 15 cease-and-desist orders against such companies. State AGs in Tennessee and Florida have also targeted loan modification firms in lawsuits alleging, among other things, that their activities constitute the unauthorized practice of law. Go here and go here for other posts on issues relating to attorneys, loan modifications, and the unlicensed/unauthorized practice of law.

(2) For whatever its worth, advising homeowners to violate the terms of their loan (by advising them to stiff their mortgage lenders) may give rise to a claim of tortious interference with a contract (or a tortious interference with a business relationship) by the mortgage lender and/or mortgage servicer being stiffed, and subjecting the loan modification firm to potential liability for dispensing the "sage" advice. See generally, White Plains Coat & Apron Co., Inc. v. Cintas Corp., 2007 NY Slip Op 3591; 8 N.Y.3d 422; 867 N.E.2d 381; 835 N.Y.S.2d 530; 2007 N.Y. LEXIS 847 (2007):

• It is a familiar proposition that one "who intentionally and improperly interferes with the performance of a contract (except a contract to marry) between another and a third person by inducing or otherwise causing the third person not to perform the contract, is subject to liability to the other for the pecuniary loss resulting to the other from the failure of the third person to perform the contract." Restatement (Second) of Torts § 766.

Court Denies Dismissal Of Suit Accusing County Of Screw Up In Giving Proper Notice To Owner In Tax Foreclosure Action

In Hopewell, New York, the Daily Messenger reports:

• A state Supreme Court justice has denied Ontario County’s attempt to dismiss a lawsuit that claims the county and its treasurer mishandled the foreclosure of the Akropolis Family Restaurant.

***

• The lawsuit alleged the county and county Treasurer Gary Baxter failed to follow correct procedures in the foreclosure auction of the Akropolis Family Restaurant in May 2007. The civil suit claimed Baxter and the county violated the civil rights of Hetelekides by mishandling the process regarding notification and other issues.

For more, see Judge rules for Akropolis owner.

For other stories on the Acropolis foreclosure, see:

• Rochester Democrat and Chronicle: Akropolis restaurant suit still simmering in Ontario County,
• Daily Messenger: Lawsuit filed against Ontario County in tax-foreclosure case,
• Daily Messenger: Flexibility, empathy lacking in tax cases.

Go here and go here for other posts on foreclosures involving faulty notifications to property owners. foreclosure faulty notice

Foreclosure Rescuers, Loan Modifiers Circle San Joaquin Valley Homeowners In Financial Trouble

In the San Joaquin Valley region of California, the Merced Sun Star reports:

• The foreclosure sharks are circling the San Joaquin Valley. [...] With Stockton, Modesto, Merced and Fresno all ranking among the nation's leading cities for foreclosures, the market invites commercial exploitation. Hundreds if not thousands of San Joaquin Valley homeowners are being besieged by letters, phone calls and even door-to-door visits that purportedly offer escape from financial harm.

• Barbara Galvan, for instance, resides in southeast Fresno and said she has never missed a mortgage payment. Nonetheless, as her adjustable rate keeps rising, she's been getting the hard sell from purported rescuers. "I'm getting lots of calls," Galvan said. "They want me to pay $3,000 or $4,000 up front. I tell them, where will I get $3,000 if I can't pay my mortgage? They say, I could put it on my credit card."

For more, see Housing crisis: Foreclosure scams abound in Valley (Organizations promise help but homeowners need to read fine print).

See also, Beware of 'vultures' as foreclosures grow:

• [San Joaquin] Valley officials report that homeowners are getting pounded by letters, phone calls and personal visits from individuals and businesses claiming they have an easy answer to financial problems. For fees of $3,000 or $4,000, they'll unlock the key to saving your home. loan modification

Pittsburgh Homeowner Out $2,800 Paid To Upfront Fee Foreclosure Rescue Firm In Exchange For Failed Loan Modification Promise

In Pittsburgh, Pennsylvania, KDKA-TV Channel 2 reports:

• [S]tephanie and her husband have been unable to keep current on their mortgage payment which carries a 12 percent interest rate. Three months ago, they gave a Florida foreclosure help company $2,800 in hopes the company could convince their lender to modify their loan.

***

• Stephanie says the company assured her of a 90 percent chance of a modified loan, but three months later her lender told them that wasn't in the cards. Now the company won't return her calls and has reneged on their money-back guarantee. "I can't even get a call back, much less money back," Stephanie said.

For more, see Couple Facing Foreclosure Fleeced By Company (read story) (watch KDKA video).

Developer Takes A Hike, Leaving Behind Handful Of Homeowners Living In Ghost Town

In Lancaster, California, the Contra Costa Times reports:

• The families who moved into Westview Estates were expecting to live in a lovely gated neighborhood of new homes, built on former farmland in this desert city. But shortly after the first families - some paying up to $400,000 for a new home - moved in around spring 2007, they started noticing problems with the water systems.(1)

***

• Residents say problems with the water - not just the economy - have turned what was planned as a 425-home development into a ghost town where homes sit vacant amid graded dirt lots choked with weeds. Only 23 homes were sold before the developer walked away, according to residents. Angry and feeling betrayed, the few residents left feel imprisoned in their problem-plagued homes that they cannot sell.

For more, see Antelope Valley homeowners left hanging by developer.

(1) Reportedly, water stopped flowing in midshower, washing machines halted midcycle, or no water came out at all. Residents could not shower and water lawns at the same time, and fire alarms went off in the middle of the night.

Traveling Real Estate Investment Seminar Teaches Sale Leaseback, Foreclosure Rescue Deals: Media Report

In Bellevue, Washington, KOMO-TV Channel 4 reports:

• A newspaper ad for the Robert Allen Institute's free seminar promised to teach participants how to become millionaires. "Banks are desperate to unload foreclosed properties," the ad's copy read. So KOMO News attended the free seminar in Bellevue, undercover camera in tow.

Reportedly, participants were told they could learn how to knock on a homeowners' door and convince them to surrender the title, then offer to broker a deal to allow the homeowner to rent back their home with an option to buy back the house.

For the video report, see The truth behind 'the best investment ever'.

Go here to read the text of the story.