Minnesota Couple Faces Foreclosure, Ruined Credit After Now-Disbarred Closing Attorney Swipes Refinancing Proceeds, Leaving Existing Loans Unpaid

In Forest Lake, Minnesota, the Pioneer Press reports:

• When Julie Tarlizzo and Reed Erickson refinanced their home and cabin mortgages in April, the transactions should have been routine. [...] But shortly after the closing, the couple received a jolt from the mortgage company that arranged for the refinance: The lender said more than $400,000 wired to an escrow account to pay off the old mortgages had been stolen. Eight months later, the matter has not been resolved and Tarlizzo and Erickson fear they might lose their homes.

• Despite a seemingly endless series of phone calls and e-mails to lenders, regulators and politicians, the couple remains in a precarious situation because the old mortgages still haven't been paid off. Meanwhile, there's no word of criminal charges against the attorney who allegedly stole the money — even though state Supreme Court records show he was disbarred in the summer after admitting to improperly withdrawing more than $2 million in escrow funds.(1)

For the whole story, see Forest Lake couple mired in mortgages (A Forest Lake couple decided to refinance mortgages on their home and cabin to take advantage of low interest rates. But escrow funds disappeared and the lenders and a title company claim they're victims of fraud, just like the homeowners).

(1) According to the story, the state Supreme Court disbarred attorney Jason E. Fischer, an owner of Real Source Title, in July following a petition for disciplinary action from the court's Office of Lawyers Professional Responsibility, according to court records.

"In connection with the operation of the mortgage closing business (Fischer) received funds that were to be deposited into an escrow account and used to pay off mortgages and other expenses related to residential real estate closing," the petition stated. "Starting in 2006 and continuing through April 2009 respondent improperly withdrew over $2 million in funds from the Real Source Title escrow account and converted them to his own use." In a stipulation that Fischer signed June 30, he unconditionally admitted the allegations of the petition and noted that he self-reported his misconduct to the lawyer discipline group and to the U.S. Attorney, the story states. EscrowRipOffKappa