Countrywide Forecloses On Bakersfield AIDS Group Home; Residents Face End Of Month Boot

The Bakersfield Californian reports:

• Bakersfield AIDS Project faces a Jan. 30 deadline to vacate the east Bakersfield house it rents for use as a group home and community center. The non-profit social service organization was asked to leave at the end of the month after the trust that owned the 102-year-old house defaulted on its mortgage.(1)

***

• Three men live in the house full-time, and dozens of others drop in regularly for social services and group meals. “It’s really a community here,” [director Audrey] Chavez said. “A lot of HIV-positive people don’t have the support of their families, so this is their surrogate family.”

For more, see Foreclosure crisis: AIDS Project up against deadline to leave house it rented.

(1) Reporedly, the bank, Calabasas-based Countrywide Financial Corp., said Friday it had “no idea” the house was a group home for AIDS patients. The company might have been willing to work with the organization if anyone had contacted Countrywide, but no one did, said spokeswoman Jumana Bauwens, according to the story.

Developer, Lender Pointing Fingers As Unsold 75% Of Condo Units In Upscale Tower Fall Into Foreclosure

In Cincinnati, Ohio, the Cincinnati Enquirer reports:

• Foreclosures proceedings are under way for the high-end condominium development Overlook at Eden Park. But the development firm behind the multi-million dollar project, Covington-based Joshua One, argues that the lender is to blame for the financial unraveling of the project, according to court documents filed in Hamilton County Common Pleas Court. So far, six of the 24 condos have been sold. Prices range from $500,000 to $3 million.

• In a motion filed Nov. 12, Bank of America claimed that Joshua One Development mismanaged its construction budget for the 13-story condo tower, which caused delays and led to unpaid bills for the project.

For more, see Condo high-rise in foreclosure.

Renting Unsold Units To Avoid Foreclosure A Possibility For Oakland Condo Developer In Default

In Oakland, California, the Alameda Times Star reports:

• An upscale residential project that is one of the keys to the downtown's revival has lurched into a mortgage default and faces an uncertain future. The owner of the 901 Jefferson complex in downtown Oakland, consisting of 75 for-sale condominiums, has defaulted on a $26 million construction loan issued in 2006, Alameda County property records show.

***

• "The downturn in the economy, plus the downturn in the condominium market, has made selling that property as condos not feasible," said Arthur Evans, president and chief executive of A.F. Evans. It's possible the lender, Keybank National Association, could attempt to seize the property through a foreclosure of the construction loan.

***

• One backup plan would be to rent the units and sell them when the market bounces back. A.F. Evans is also attempting to find a buyer for the property, which is completed but remains vacant.

For more, see Upscale Oakland project in trouble.

Builder Tried Rent To Own, Now Goes With Auction To Unload Slow Moving Inventory

In Brookfield, Illinois, the Riverside/Brookfield Landmark reports:

• [L]ast week, the "for sale" signs in front of the Courtyards of Brookfield at Shields and Eberly avenues came down in favor of two signs announcing the auction of 11 unoccupied units in the development. The project, which features 16 townhomes in four separate structures, broke ground in the spring of 2007 at a base listing price of $355,000 per unit.

• The development has been completed, but only one unit has sold. Four others are occupied and have rent-to-own leases. The remaining 11 townhomes will be auctioned off on Sunday, March 1 [...] starting at a minimum bid of $189,000.

For more, see Economy puts squeeze on townhome projects (Brookfield units will be auctioned; Riverside site for sale, in foreclosure).

Lease-Option Tenants In New Townhouse Development Caught Between Conflicting Demands For Rent From Builder In Foreclosure & Stiffed Mortgage Lender

In Bakersfield, California, KBAK-TV Channel 29 reports:

• Creekside Townhomes is a row of 32 units at 500 White Lane. Tenants can lease to own, but the project is facing financial troubles.

***

• On Dec. 22, tenants' received a letter from a law firm representing First Regional Bank. The letter tells tenants' to make all future rent payments directly to First Regional Bank instead of to the landlord, Project Manager Robert Hernandez.

***

• But four days after tenants' received the letter from the bank, Hernandez issued his own notice. In it, Hernandez writes that the bank acted "prematurely" in issuing the notice and says the bank letter is "not applicable". Hernandez tells tenants' to "please disregard this (the bank's) notice."

• Tenants' are left wondering who, if anybody they should hand over their rent. If the property goes into foreclosure, some wonder if they'll lose their deposit or other lease payments.

For the story, see Foreclosure worries loom for Creekside Townhomes tenants.

Developer Disaster Leaves 10 Families Living In S. Florida Ghost Town; Letter Carriers Refuse To Deliver Mail; Cops Can't Find Complex On Their System

In Florida City, Florida, WFOR-TV Channel 4 reports:

• Ten families bought a piece of the American dream, only to end up with a nightmare. A bank took over a South Florida development before it was complete. Now, the people who bought in are stuck living in a ghost town.

***

• The community looks great from the outside. But on the inside, it's a pre-construction nightmare. The developer built very little outside of the nightmare these homeowners are stuck living in.

***

• [The project] is a modern-day ghost town. Rows of empty townhouses sit on blocks of paved roads being devoured by weeds. [...] The developer is now long gone. Of the 614 promised units, only 70 were ever built. And only ten units were ever sold.

• Those ten owners have a massive problem on their hands. Looking past the fact that nobody would buy or rent those homes, the fact of the matter is that to many, they don't exist at all. The U.S. Postal Service won't deliver mail that far. There are no street lights, and thieves have been ransacking houses for appliances. "We called the Florida City Police; they couldn't find us in the system," [said one homeowner].

For the story, see Developer's Disaster Causes Modern Ghost Town (Florida Keys Townhomes Only Has 10 Sold Homes).

For the WFOR-TV video, see The American Dream Bought By The Bank.

Condo Developers Stuck Holding Excess Inventory Turning To Renters For "Bailout"?

In Las Vegas, Nevada, KLAS-TV Channel 8 reports:

• The condo craze exploded in the Las Vegas valley just a few years back, but now with the foreclosure crises, people aren't buying into condos when housing prices are so low. It leaves condos floundering with too much inventory.

• When you look at big condo projects like Loft 5, it probably does not occur to you that there is any option other than to buy. But with the condo sales market at a standstill, some big developers are shifting strategy and going after renters.

***

• "Developers have excess inventory, they need to do something with it, and how do they survive or what do they do between today and whenever things improve? And certainly one of the alternatives is to rent them out," said David Krantz with RMI Management. Krantz's company has been retained by the Loft 5 developer to lease about 200 units.

For more, see Condo Developers Turn to Renters for Relief.

Attorney On Trial For Forgery, Criminal Breach Of Trust For Allegedly Duping 85-Year Old Man Out Of $160K In Bogus Mortgage Investment Deal

In Barrie, Ontario, the Toronto Sun reports:

• An 85-year-old investor stood up in the witness box yesterday and told the court that a lawyer is a "criminal" who duped him out of $160,000 in a fake mortgage scheme. "All that he told me was a bunch of lies," said Sam Klaiman, after a full day of questioning in the witness box.

• On trial is Barrie-area lawyer Myles McLellan, 55, who is facing eight criminal charges including forgery and criminal breach of trust. Klaiman, a wealthy investor who started up his Toronto based business, Homark Real Estate Ltd., in 1936 at the age of 13, testified that he trusted McLellan because he is a lawyer. [...] The trial is expected to continue for two weeks.

For more, see 'Criminal' lawyer in dock on fraud charges.

For more, see Mistrial declared in fraud trial (Crown doesn't buy suspect's argument).

*****************

For those in Canada, if a Canadian attorney, in the course of representing you, screws you out of money or property through dishonest conduct, click on your province on the Canada Client Protection Funds Map to contact the appropriate Law Society Client Compensation Fund about filing a claim to seek some reimbursement for your losses.

For those in the United States, see:

• Directory Of Lawyers' Funds For Client Protection (American Bar Association); or
• Check the USA Client Protection Funds Map.

Ohio Attorney Gets 4 Years For Lifting $624K+ From Escrow Account, Stiffing 23 Clients In The Process

In Toledo, Ohio, the Toledo Blade reports:

• A former Toledo attorney who pleaded guilty to stealing hundreds of thousands of dollars from her clients was sentenced in Lucas County Common Pleas Court Thursday to 4 years in prison. Karyn McConnell Hancock, 38, was convicted of aggravated theft in November for stealing more than $624,000 from 23 clients over a period of nearly six years.(1)

***

• Authorities said that McConnell Hancock would put money into an attorney escrow account for clients of personal injury cases, probate matters, and real estate issues, and would divert some of the funds for personal use.

***

• Those clients who investigators have identified as victims of theft have been advised to file a claim with the Client Security Fund of the Supreme Court of Ohio. The fund is made up of money from registration fees paid by Ohio's attorneys and is used to reimburse those who are victims of attorney misconduct.

For more, see McConnell Hancock gets 4 years.

For those outside of Ohio who get screwed out of money or property by an attorney in the course of representing you, and seek some amount of reimbursement, see:

• U.S.: Directory Of Lawyers' Funds For Client Protection (American Bar Association);
• U.S.: Check the USA Client Protection Funds Map;
• Canada: Check the Canada Client Protection Funds Map.

(1) Reportedly, because McConnell Hancock would ultimately pay back some of that money with other accounts, authorities believe the total stolen was about $389,000. EscrowRipOffAlpha

Cop In Foreclosure Now Faces Bank Robbery Charges

In Carbondale, Illinois, the Chicago Tribune reports:

• A Carbondale police officer has been suspended without pay after prosecutors alleged he and his neighbor were the two men that robbed a bank at gunpoint while wearing motorcycle helmets. Jackson County prosecutors charged city patrolman James Gaddis, 26, and Anthony Fike, 35, both of Murphysboro, in the Oct. 9 holdup of the First Southern Bank in this southern Illinois city. Authorities would not discuss a possible motive in the holdup, though Jackson County Circuit Court files show that Flagstar Bank filed mortgage foreclosure proceedings against Gaddis in December.

For more, see Carbondale police officer accused of robbing bank.

JP Morgan To Modify Troubled Securitized Mortgage Loans; Doesn't Believe Actions Will Violate Investor Agreements

In New York City, Reuters reports:

• JPMorgan Chase & Co., the second-largest U.S. bank by assets, on Friday said it will boost home foreclosure prevention efforts by modifying loans tied up in securitizations, in addition to the loans it owns.

***

• "Chase believes it can legally modify the vast majority of its mortgages owned by investors consistent with the relevant investor agreements and the best interests of investors," the retail arm of JPMorgan said in a statement. It will seek approvals from a "small number" of situations where contracts may limit modifications, it added.

• An investor group led by Greenwich Financial Services is suing to force Bank of America-owned Countrywide Financial to repurchase thousands of loans that the lender intends to modify under a predatory lending settlement. The lender would be liable to pay hundreds of trusts about $80 billion for loans it modifies, according to lawyers of the plaintiffs.

For more, see Chase to tackle modifying investor-owned mortgage.

For Greenwich lawsuit, see Greenwich Financial Services v. Countrywide Financial Corporation.

SW Florida Broker Guilty In Commercial Land Flipping Deal; Allegedly Clipped Investors For Almost $3M

In Fort Myers, Florida, WINK News reports:

• Guilty as charged -- that's the verdict a federal jury handed down in the case of Samir Cabrera. Jurors agreed that the Lee County land developer cheated his investors out of nearly $3 Million. He'd hoped to be a well-respected land developer. Instead, Samir Cabrera's failed projects will land him in prison. On Tuesday, the once-undecided federal jury wrapped up the week-long trial with a unanimous guilty verdict on all 11 counts against Cabrera.

For the stories, see:

• Samir Cabrera found guilty on all 11 charges,
• Cabrera found guilty on all counts,
• Cabrera: ''It's been a tough day".

For the indictment, see U.S v. Cabrera.

Go here for earlier posts on this story.

Fannie, Freddie Accused Of Requiring Financially Strapped Homeowners To Waive Legal Rights As Condition To Getting Loan Modifications

The Washington Independent reports:

• When the government announced in November that it would use mortgage giants Fannie Mae and Freddie Mac to streamline loan modifications for possibly hundreds of thousands of borrowers, officials billed the idea as a fast-track program to fight foreclosures. What no one mentioned is that homeowners would have to sign away their rights to sue, if they wanted to get those loans modified.(1)

***

• [I]ncluded in the Fannie agreement is a provision stating that “borrower has no right of set off or counterclaim or any defense to the obligations of the Note or Security Instrument.”

• The waiver is part of the borrower requirements that must be signed for the loan modification. Fannie Mae’s sample version is available on one of its websites; the Freddie Mac agreement, which has similar language, can be accessed only by servicers. The agreements were designed by Fannie and Freddie.

• In plain English, the waivers mean a borrower can’t sue the lender who originated the mortgage if the loan modification goes bad, or for any other lending abuses concerning their loan, [senior policy counsel for the Center for Responsible Lending Julia] Gordon said.(2)

For more, see Freddie, Fannie Force Borrowers to Waive Legal Rights (Housing Advocates, Congressional Leaders Call Practice Abusive).

(1) Requiring borrowers to waive their legal rights in order to get loans modified has become an increasingly popular tactic as the housing crisis has worsened, said Ira Rheingold, executive director of the National Association of Consumer Advocates. He said consumer attorneys regularly advise clients not to sign modification agreements with waivers, or to cross out the waivers first. “It wasn’t invented by Fannie and Freddie,” Rheingold said. “I’m not surprised it’s in there, but I’m disappointed. It’s a real issue. The government shouldn’t be asking people to waive their rights to claims.”

(2) Gordon said that a House Financial Services Committee hearing in July featured a dramatic confrontation, in which Countrywide representatives denied requiring the waivers - until she produced a copy of one from her briefcase. The lenders said they would put the waivers under review. Committee Chairman Barney Frank told them to put the waivers “six feet under” review, and to end the practice.

Toxic Chinese Drywall Suspected Source Of Health Problems For C. Florida Homeowners, Pets; May Also Be Cause Of Home Equipment, Electronics Failures

In Manatee County, Florida, the Sarasota Herald Tribune reports:

• As the investigation into toxic Chinese drywall continues, a single street in Manatee County appears to be ground zero for the largest cluster of problem homes. Within the Lighthouse Cove subdivision of Lennar's Heritage Harbour development, sits a quaint street of two-story homes called Montauk Point Crossing. Today, it is a virtual ghost town.

• At least six families have already moved out of their homes, either at Lennar's expense or their own. At least two more are planning their exits as soon as possible. The residents, many with small children, are experiencing an outbreak of the same chronic symptoms -- respiratory problems, painful sore throats, headaches and nosebleeds -- which they attribute directly to the drywall chemicals filling their homes.

• Residents of Montauk Point have seen their air-conditioners fail on a regular basis -- so often that the presence of a white HVAC repair truck became a running joke in the neighborhood. Metal within their homes corroded and turned black: piping, electrical wiring, even silver jewelry. Electronics also began to fail and short-circuit. Residents say they have gone through multiple televisions, computers and cable boxes. Light switches stopped working altogether, or only intermittently. "I'm on my third TV," said homeowner Dan Tibbetts. "Everything just dies."

Reportedly, one family had their two dogs euthanized after they began acting erratically; one became oddly aggressive and the other would not drink water.

For more, see Ground zero in drywall dispute.

HUD Launches Program In Six Cities To Help Homeowners Not Yet In Foreclosure

In Miami, Florida, The Miami Herald reports:

• [A]nother effort to keep borrowers from losing their homes to foreclosure was launched Wednesday by the Department of Housing and Urban Development. Called ''Keep Your Home, Know Your Loan,'' the campaign includes public service announcements and print materials that will be distributed in six major metropolitan areas where home foreclosures rates are soaring, including Chicago, Los Angeles, Detroit, New York, Phoenix, and, naturally, Miami.(1)

• ''This is an opportunity for us to reach out to people who may not be in foreclosure yet, but could be facing one this year, due to a rate change, the economic downturn, job loss or having their hours cut,'' said Armando Fana, director of HUD's field office in South Florida.

For more, see Miami homes get HUD lifeline (Federal housing officials chose Miami and five other cities to launch a foreclosure prevention campaign, complete with a hot line, and warned home owners to watch out for 'rescue' scams).

Go here for more information on the HUD program - Keep Your Home. Know your Loan.

(1) As part of its campaign, HUD has also launched a new hot line, 877-HUD-1515, where homeowners can get information about HUD-approved counseling agencies in their area.

Fraudulent Flipping Of One South Florida Home Lands Four In Federal Can

In Miami, Florida, the U.S. Attorney's Office announced that Yadira Garrido (51 months in prison, 3 years probation, & $5.3+ million in restitution), Jorge Cordero (10 months, 3 years probation, and $840,000+ in restitution), and Maritza Salan (60 days, 3 years probation, and $800,000+ in restitution) were sentenced last week for their roles in the fraudulent flipping of one residential property in Coral Gables.

• According to the Indictment and statements made during the pleas, the defendants transferred the residential property three times within approximately one year, resulting in almost doubling the price of the property from $780,000 to $1,400,000.

The property ultimately went into foreclosure, resulting in the lender taking a hit. Another defendant, Ishmett Nazario, previously was sentenced to 41 months in prison, 3 years probation, and was ordered to pay over $1.4 million in restitution.

For the U. S Attorney press release, see Mortgage Fraud Defendants Sentenced To Prison.

Listing Agent Photos May Be Key In Prosecution Of Foreclosed Homeowner Accused Of Trashing Home Before Walking Away

In Oregon City, Oregon, KPTV Channel 12 reports:

• Investigators said a Damascus couple whose house went into foreclosure trashed the place, stole every appliance and fixture inside and are now facing criminal charges. Grigoriy and Inna Bogoslavets have been indicted by a grand jury on charges of theft, trespassing and criminal mischief.

***

• According to court documents, between August and November 2008, they stripped and damaged their old house, causing more than $50,000 in damages.

***

• The previous owners, Grigoriy and Inna Bogoslavets denied any wrongdoing and claimed they'd been living like that for some time. But [real estate agent Carl] Iams said his firm posted pictures for their sales listing, with the house in excellent condition, right before the family moved out.

For more, see Couple Indicted After Foreclosed Home Stripped (Former Homeowners Took Everything, Investigators Say) (read story) (watch KPTV video report).

Go here for other posts on pre-foreclosure homeowner fixture stripping. foreclosure fixture stripping apple

Freddie Continues Bringing Foreclosure Actions; Says Its Announced Moratorium Applies Only To Actual Sales & Evictions, Not To Court Filings

Bloomberg News reports:

• Freddie Mac continues to foreclose on homeowners and make plans to evict them, drawing fire from legal aid groups who say the moves violate the spirit of a moratorium the company agreed to in November. While Freddie has suspended sales of foreclosed properties and isn’t locking people out of their homes, the mortgage- finance company continues to initiate court cases against homeowners and pursue existing cases, company spokesman Brad German said.

***

• “The actual sale, the actual eviction has stopped, but the process continues,” German, the Freddie spokesman, said yesterday. “The moratorium does not affect the normal process of legal filings. But no one is being evicted, the homes are not being sold,” he said.

***

• By contrast, Fannie [Mae] has worked to halt court proceedings and notify borrowers and tenants that they may be eligible to stay in their homes if they agree to sign a new monthly lease at market rates, according to [legal aid attorneys]. When cases have fallen through the cracks and court action continued, Fannie is “literally sending people out to knock on doors to make them aware of the policy and, when they’re not home, we leave flyers with information about their options,” said Fannie spokesman Brian Faith.

For more, see Freddie Foreclosures, Eviction Plans Continue During Moratorium.

Authorities Have Their Hands Full As Real Estate Operators Shift From Equity Stripping Scams To Upfront Fee Loan Modifications

The New York Times reports:

• As home values across the country continue to plummet, the authorities say a new breed of swindler is preying on the tens of thousands of homeowners desperate to avoid foreclosure.

• Until recently, defrauders tried to bilk homeowners out of the equity in their homes. Now, with that equity often dried up, they are presenting themselves as “foreclosure rescue companies” that charge upfront fees to modify loans(1) but often do nothing to stave off foreclosure.

• The Federal Trade Commission brought lawsuits last year against five companies representing 20,000 customers, and state and local prosecutors have brought dozens more.

***

• “There’s no way for the consumer to sort out the legitimate companies,” said [Florida Attorney General Bill] McCollum, who added that he had limited resources to fight what he called “a sheer volume question.” [...] “That’s all I’ve been doing for the last year,” said Angela Rosenau, a deputy attorney general in California, citing more than 300 complaints about fraudulent companies last year, not counting those made to local prosecutors. [...] In Colorado, the attorney general’s office has closed 15 mortgage rescue companies that charged fees up front. [...] The [Illinois] attorney general’s office has received “thousands” of complaints about such companies, said Michelle Garcia, an assistant attorney general [...].

For more, see Swindlers Find Growing Market in Foreclosures.

(1) According to the story, there are 21 states that prohibit charging upfront fees for negotiating loan modifications.

Attorneys For Major Lender In New Hampshire Lawsuit Admit Company's Loan Modification Assurances Are "Mere Commercial BS"

In Merrimack County, New Hampshire, MSNBC.com reports:

• In marketing, advertising and testimony before Congress, Countrywide Home Loans has said repeatedly that it is working hard to modify the mortgages of financially strapped borrowers caught up in the subprime meltdown.

• But in a New Hampshire court, attorneys for the lending giant are singing a different tune, describing such assurances as “mere commercial puffery.”

• Saying the modification offers are “only Countrywide’s vague advertisements,” attorneys for the lender are asking the court to throw out a lawsuit alleging breach of good faith, fraud, negligence and misrepresentation, which was filed on behalf of a family that was refused a loan modification by the California-based company.

• “It’s breathtaking,” attorney Mary Frances Stewart of Concord, N.H., said of Countrywide’s response to the lawsuit she and co-counsel Krista Atwater filed in Merrimack County Superior Court. In its response, “Countrywide is saying, ‘We don’t have any obligation or even necessarily the intention of actually modifying these loans,’ and yet they’re representing that they do.”

For more, see In court, Countrywide calls its ads ‘puffery’ (Defending lawsuit, mortgage company mocks loan modification assurances) (go here for entire story on one web page).

Contoversial Nationwide Service To Facilitate Loan Modifications In Bankruptcy Leaves Debtor Attorneys Divided

MSNBC.com reports:

• Aiming to keep overextended borrowers in their homes, judges and trustees in the federal bankruptcy court system have helped a small Kentucky firm set up a nationwide service intended to speed the modification of troubled mortgages.

• But the court system’s unusual support for the private project, which some supporters believe could also help stem a surge in bankruptcies, has divided debtor attorneys, some of whom believe their colleagues have gotten in bed with the enemy and others who say it is just one potential tool to clean up a giant mess. It could, however, make millions for its creator.

• The idea behind the “Debtors Counsel Loss Mitigation Web Portal” is simple, owner Joseph C. Smith II told msnbc.com in an interview. Attorneys representing troubled borrowers can use a single Web site to communicate with many mortgage servicers and lenders about changing the terms of loans. The servicers and lenders, in turn, can consolidate their work on such requests.

***

• [D]avid Baker, a bankruptcy attorney from Boston, told msnbc.com that he is using the site and “I’m certainly going to put as many of my clients through it as I can in hopes that we accomplish something.”

***

• But [April] Charney, the Florida legal aid attorney, said her work has proven that, because of securitization issues, the true ownership of many currently troubled mortgages cannot be determined, which means that deals with lenders cannot be made. “Maybe they’re using this data to access a workout, but if you’re in my world you know there’s no workouts to be had,” she said. “I don’t want my client giving out financial information to the other side, and that’s what you’re doing with this portal.”

For more, see Bankruptcy system takes on the mortgage mess (Federal trustees help private entity land role as delinquent-loan middleman) (go here for entire story on one web page).

L.A. County To Aggressively Attack Real Estate Fraud As Complaints On Loan Modification, Foreclosure Consultants Flood County Consumer Affairs Office

In Los Angeles, California, the Los Angeles Daily News reports:

• At a time when home foreclosures in Los Angeles County have increased elevenfold in the past three years, the Board of Supervisors launched a new effort Tuesday to attack predatory lending practices and aggressively prosecute real estate fraud.

***

• Pastor Herrera Jr., director of the county Consumer Affairs Department, said his office is receiving a flood of telephone calls from people victimized by the deceptive practices of home loan modification facilitators and foreclosure consultants.

• "The most common thing we're seeing are people who tell the homeowners if they give them some upfront money that they can guarantee they will get them a loan modification with a fixed interest rate and there is no problem because of their past credit history," Herrera said.

• If the homeowners are already in foreclosure, Herrera said, foreclosure consultants represent themselves as the "saviors," promising to get them out of foreclosure and sometimes pressuring homeowners to sign documents transferring ownership of the home to the consultants.

For more, see It's war on real estate fraud.

New Foreclosure Hotline For Financially Strapped New Jersey Homeowners Gets 6,000+ Calls In First 3 Days

In Newark, New Jersey, The Star Ledger reports:

• A statewide foreclosure prevention hotline that began Friday has been unable to handle the overload of calls, said David Wald, a spokesman for the Attorney General's Office.
  "The response has been pretty phenomenal," he said.

***

• [Melville D. Miller Jr., president and general counsel of Legal Services of New Jersey, which runs the hotline] noted that by 2 p.m. [Tuesday], the hotline's three dozen staffers had received 6,000 calls. The subjects ranged from people worrying that foreclosure is on the horizon to those who have actually received a foreclosure notice, he said.(1) [...] The hotline, 1-888-989-5277, is staffed Monday through Friday from 8 a.m. to 6 p.m.

For the story, see Blackout leaves foreclosure line unable to answer residents' calls.

(1) The free program reportedly links homeowners with certified housing counselors who can recommend mort gage options including the waiving of fees and penalties or lowered interest rates. If counseling yields no resolution, the case moves to mediation, at which time the homeowners may be eligible, based on income, for free legal representation.

Struggling Developer Turns Tables On Uncooperative Lenders; Uses "Asset Assignment" To Force Mortgage Holders To Negotiating Table

In Sarasota, Florida, the Sarasota Herald Tribune reports:

• Unable to get bankers to renegotiate nearly $22 million in debt, Southwest Florida home builder Lee Wetherington has filed a legal action akin to a bankruptcy proceeding. Wetherington said that the filing, known as an "assignment for the benefit of creditors," affects only the development side of his business, and that he is using it as tactic to bring bankers to the negotiating table.(1)

• "This forces them to come back and look at the properties and also gives us more time to negotiate better terms," Wetherington said.

***

• "When banks are taking a position to force your hand, you have to take a stand and make them negotiate," Wetherington said. "It's crazy, but the only way to get them to talk is to stop making interest payments and to file an assignment for the benefit of creditors."

For more, see Loan renewals pose threat; one builder acts to force negotiation.

(1) Reportedly, Wetherington's bankers want him to fork over millions of dollars in return for renewing loans on land that has lost value in the real estate meltdown.

Unwitting Straw Buyer Sues Bakersfield Broker For Unauthorized Use Of His Name In Flipping Deal, Ruining Credit, Leaving Him Holding The Bag

In Bakersfield, California, KGET-TV Channel 17 reports:

• An Oakland man is suing former Realtor David Crisp, saying Crisp used the man's name in a house flipping scheme that ultimately defrauded lenders. Jorge Ochoa says David Crisp destroyed his good credit. Ochoa wants $75,000 in damages. "He was just a victim, one of many, of the scams of David Crisp," Ochoa's attorney Harvey W. Stein said.

• The state stripped Crisp of his real estate license following a hearing in July 2008, and he and his former business partner Carl Cole are the subjects of an ongoing FBI mortgage fraud investigation.

***

• Stein filed a lawsuit on Ochoa's behalf for $75,000, saying Ochoa's credit card interest rates have gone through the roof. But Crisp has not responded to the lawsuit, and Stein is moving for a judge decide in his client's favor by default.

For more, see Suit: Man was victim of David Crisp scheme.

For the lawsuit, see Ochoa v. Crisp.

Baltimore, St. Paul Among At Least 18 Cities Forming Litigation Work Group To Hammer Mortgage Lenders Over Vacant & Abandoned Foreclosures

In Baltimore, Maryland, The Maryland Daily Record reports:

• Baltimore’s law department is partnering with 18 cities across the country to use litigation to address the foreclosure crisis. City Solicitor George A. Nilson spoke Monday afternoon in support of a City Council resolution that was to have been introduced at Monday evening’s meeting that establishes a “Multi-City Litigation Work Group on Foreclosures” and would include officials from Chicago, Atlanta, Memphis and other cities.

• “The purpose and the importance of it is to do, at the city or municipal level, what has been done at the state level, and that is to deal with common problems of consequence in a coordinated manner rather than in an ad hoc manner,” Nilson said.

• The idea for the work group came from officials in St. Paul, Minn., who are considering litigation against the six major lenders that own the most vacant property in that city, including Wells Fargo, USBank, Deutsche Bank, HSBC and Chase.

For this story, see City joins 18 jurisdictions across U.S. in fighting foreclosures.

******************

In St. Paul, Minnesota, the Pioneer Press reports:

• St. Paul is helping to create a national working group of city attorneys who are trying to hold lenders accountable for the accumulation of vacant and foreclosed-on homes in urban areas.

• The idea is for the chief legal officers — some of whom have filed lawsuits against lenders — to share information and coordinate legal strategies that might decrease foreclosures and vacancies. A City Council resolution of support for St. Paul's participation in the working group is expected to be introduced this week.

***

• John Choi, the city attorney in St. Paul, has been appointed to co-chair the working group along with his counterpart in Baltimore, and city officials expect other municipalities to announce their involvement in the coming weeks.

For this story, see St. Paul / City goal to curtail vacant properties (National group to seek solutions).

See also, Minnesota Lawyer: St. Paul announces the launch of multi-city foreclosure litigation initiative.

Memphis Loan Modification / Foreclosure Rescue Firm Agrees To Temporary Injunction With Tennessee AG; Will Stop Clipping Homeowners For Upfront Fees

In Memphis, Tennessee, Memphis Commercial Appeal reports:

• Memphis mortgage rescue company Patrick & Patrick Loss Mitigation Services has agreed to stop what the Tennessee Attorney General charged in a Nov. 18 lawsuit (go here for the Tennessee AG's Nov. 18 press release; here for the Tennessee AG's lawsuit; and here for Motion for Temporary Injunction & Asset Freeze) were illegal activities.

• According to the temporary injunction agreed to Tuesday by the firm and the attorney general, the firm may not engage in unfair or deceptive business practices, practice law, offer credit services without registering a bond with the state and must tell consumers in writing what services the firm and its people have provided before getting paid.

For more, see Memphis mortgage rescue company agrees to stop 'illegal practices.'

For Tennessee Attorney General Bob Cooper's January 13, 2009 press release, see: Tennessee Foreclosure Rescue Company Enters Agreed Order to Halt Alleged Unlawful Activities.

The Sloppiness Continues For Attorneys Representing Foreclosing Lenders; "They Are Totally Disorganized!" Says Florida's 12th Judicial Circuit Chief

In Sarasota, Florida, the Sarasota Herald Tribune reports:

• [T]he foreclosure glut is so bad that the law firms that specialize in handling the court cases in bulk for lenders are now too busy. They even let many foreclosure cases stall and remain inactive for months or years, if resident homeowners put up any sort of legal fight.

• [Florida's 12th Judicial Circuit Chief Judge Lee] Haworth says those law firms are apparently even failing to read [his] official written notifications [...]. Notices about local courtroom rules changes, like Haworth's requirement that there be a mediation meeting with a homeowner before a foreclosure can proceed, seem to go unread.

• "They are totally disorganized," Haworth said. They seek court hearing dates that the new rules say they are not entitled to, and seem clueless about it all.

For the story, see Troubled mortgages burdening the courts.

For Chief Judge Haworth's official notifications and links to the forms now required to be filed by attorneys representing foreclosing lenders within Florida's 12th Judicial Circuit (Sarasota, Manatee, and Desoto Counties), see:

• Chief Judge's Letter To Attorneys Summarizing New Foreclosure Procedures And Administrative Orders,
• Administrative Order Establishing Circuit-Wide Homestead Foreclosure Conciliation Program,
• 12th Judicial Circuit's Foreclosure Forms Section (links to required forms and procedures for 12th Circuit foreclosure actions),
• Go here for the 12th Judicial Court's website.

Go here for other posts on the foreclosure mediation program in Florida's 12th Judicial Circuit (Manatee, Sarasota, and Desoto Counties).

For posts that reference the failure of mortgage lenders and their attorneys to file the proper paperwork when bringing foreclosure actions, Go Here, Go Here, Go Here, Go Here, and Go Here. KappaMtgDocsMissing

Fannie Unveils Its "No Boot" Policy For Eligible Tenants In Foreclosed Homes; Renters To Choose Either Month-To-Month Lease Or "Cash For Keys"

In Washington, D.C.:

• Fannie Mae [Tuesday] announced the establishment of a new National Real Estate Owned (REO) Rental Policy that will allow qualified renters in Fannie Mae-owned foreclosed properties to stay in their homes.

***

• The new policy applies to renters occupying foreclosed properties at the time Fannie Mae acquires the property. Renters occupying any type of single-family property will be eligible including residents of two- to four-unit properties, condos, co-ops, single-family detached homes and manufactured housing. Eligible renters will be offered a new month-to-month lease with Fannie Mae or financial assistance for their transition to new housing should they choose to vacate the property. The properties must meet state laws and local code requirements for a rental property.

For the Fannie Mae press release, see Fannie Mae Announces National REO Rental Policy (Renters in Fannie Mae-Owned Foreclosed PropertiesEligible to Stay in Their Homes).

Go here for Fannie's National Real Estate Owned Rental Policy Frequently Asked Questions.

New Jersey Sets Aside $12M To Train, Pay For Attorneys, Counselors In Statewide Foreclosure Mediation Program

In Trenton, New Jersey, Legal Newsline reports:

• Eligible New Jersey homeowners will be able to use a new state-supported mortgage foreclosure mediation program(1) aimed at helping homeowners remain in their homes.

***

• The program is supported by $12.5 million in state funds, $12 million of which will be used to train and pay for housing counselors and lawyers through the New Jersey Housing and Mortgage Finance Agency. The other $500,000 will be used to provide foreclosure mediator services to homeowners.

• Eligible homeowners will be provided lawyers to consult with housing counselors in proposing ways to resolve mortgage delinquencies. Homeowners and lenders who are unable to resolve their disputes out-of-court will [ap]pear before a neutral court-appointed mediator. To be eligible for the mediation program, homeowners must not be in bankruptcy, the homeowner's primary residence must be the property facing foreclosure, and the residence must be a one to three-family residence.

For the story, see N.J. homeowners to receive state supported foreclosure media.

(1) Reportedly, the program is a joint effort of the Judiciary, the Office of the Attorney General, the Housing Mortgage Finance Agency in the Department of Community Affairs, the Public Advocate, the Department of Banking and Insurance, and Legal Services of New Jersey.

DC Man Gets 12+ Years In Deed Theft Scam Targeting Deceased Owners; Victimized Families Forced To File Civil Suits To Properly Restore Property Titles

From the Office of the U.S. Attorney (District of Columbia):

• A District of Columbia man, Duane McKinney, [...] was sentenced [last week] to 150 months in prison on charges of fraud, theft, and monetary transactions,(1) [...].

***

• The government's evidence at trial established that Duane McKinney obtained title to about $1 million worth of D.C. and Maryland properties through forged deeds, that is, deeds which purported to be signed by the owners transferring the properties to McKinney or his shell business. In fact, the deeds were not signed by the owners; the vast majority of the owners were deceased at the time of the forged and false deeds.

• McKinney was assisted by Joe D. Liles,(2) who would sign his name to these false deeds as the "notary" falsely stating that he saw the owner sign the deeds as grantor and that the owner "personally appeared before him." Once the deeds were notarized, McKinney would then sell the properties as if they belonged to him or his business and would use the money for himself.

• Some of those who purchased the homes lost all of their purchase money;(3) others whose families owned the homes for generations were required to file suit against McKinney to regain their properties.

For the press release, see District of Columbia man sentenced to prison on charges of theft, fraud, and money transaction offenses relating to forged property deeds.

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

(1) McKinney was also ordered to pay $912,630.75 in restitution and to forfeit to the United States three luxury vehicles and two real properties; the court also ordered two money judgments in the amounts of $770,872 and $59,000.

(2) Liles was sentenced to 180 days, execution of sentence suspended, three years probation, and to pay restitution of $691,587, according to the press release.

(3) The press release is silent as to whether the unwitting homebuyers bore the entire loss of their purchases, or whether they obtained a title insurance policy (which would have likely insured their title against this type of scam), in which case the title agent & underwriter issuing the insurance may be left on the hook for the loss. KappaDeedTheft

Maryland Victim Of "Money Store" Equity Stripping Scam Loses Battle Against Lender Seeking Mortgage Foreclosure

The Maryland Court of Special Appeals ruled last week against a homeowner fighting to save her home from foreclosure where her financial predicament was exacerbated by seeking help from a now-defunct foreclosure rescue operator.(1)

The court decision addressed the application of Maryland's Protection of Homeowners in Foreclosure Act (PHIFA), and how it applied as against a foreclosing lender.(2) The court ruled that PHIFA did not void the foreclosure rescue transactions, but rather made them voidable as to persons with notice. The mortgagee, the assignee of the lender who provided the financing in the foreclosure rescue, equity stripping scam, was held to be a bona fide purchaser/lender, and accordingly, was not subject to the homeowner's right of rescission.

In seeking to disqualify the foreclosing lender as a bona fide purchaser/lender without notice, the homeowner contended that the foreclosing lender had notice of the alleged fraudulent scam by reason of the fact that the foreclosure rescue operator, the closing agent, and/or the straw buyer were agents of the lender and their knowledge was imputed to it.

Alternatively, the homeowner contended that the foreclosing lender was on notice of sufficient facts to impose a duty to make appropriate inquiries, and failed to do so, thereby disqualifying it as a bona fide purchaser/lender and preventing it from foreclosing.

The court rejected both contentions.

For the court decision, see Julian v. Buonassissi, No. 2740, Court of Special Appeals of Maryland, 2009 Md. App. LEXIS 2 (January 5, 2009).

(1) The alleged scam was one involving the notorious Metropolitan Money Store, of Lanham, Maryland.
(2) Maryland Code (2005, Supp. 2006), § 7-301, et. seq. of the Real Property Article.

Cramdowns & Lien Stripping Of Home Mortgages Under Existing Bankruptcy Law

Buried at the end of a recent story in The Wall Street Journal contains an excerpt referencing how the existing bankruptcy rules can be used when stripping second mortgages from "underwater" real estate(1) (either owner-occupied or investment properties), and how the current bankruptcy cramdown rules (unless changes currently under consideration are enacted) can only be used to modify (ie. cramdown) existing first mortgages on investment properties and not those that are owner-occupied:

• Samuel Schwartz, a Las Vegas bankruptcy lawyer, has a client who is facing foreclosure on her primary residence even though she has been able to modify the loans on her two investment houses. Under the current bankruptcy rules, she was able to "strip away" the second mortgage on one of the investment homes and she "crammed down," or reduced, the principal balances on the first mortgages for both rentals -- reducing her combined loan balances to a total of $355,000 from $590,000.

• She was also able to strip away the second mortgage on her primary residence but couldn't modify the first mortgage. That mortgage, Mr. Schwartz said, is more than $100,000 above the current value of the property. Thus, she still may lose her own home. Under the [proposed] new law, her first mortgage on her home also could be modified.

For the story, see Power to Modify Mortgages Sits Well With Judges.

(1) Property that is worth less than the amount owed on the existing mortgage(s) encumbering the real estate.

Two Loan Modification Firms Resolve Issues With Colorado AG; Agree To Refund $30K To Homeowners, Pay $10K In Investigative Costs

In Denver, Colorado, Rocky Mountain News reports:

• Two companies collecting money to help homeowners avoid foreclosure have reached agreements with Colorado Attorney General John Suthers, [...].

• Suthers announced Sunday that Castle Rock-based Hawk Financial Services agreed to pay $26,500 in fees unlawfully collected from 31 customers before performing any service. Suthers also collected $10,000 in penalties, costs and attorneys' fees. Infinity Funding Group of Bohemia, N.Y., agreed to refund a $3,500 payment collected up front from one customer.

Source: Attorney General reaches settlement with mortgage companies.

San Diego Media Outlet Looks Into Area Loan Modification Firm

In San Diego, California, XETV-TV Channel 6 recently reported on My Safe House, a loan modification firm in Oceanside that charges homeowners an upfront fee of $2,995. Channel 6 spoke to a former telemarketer who worked for the firm and obtained a telemarketing script reportedly used by the firm to reel in financially strapped homeowners.

For the story, see They Promise a Safe House But Do They Deliver? (read text) (watch video).

Go here for the firm's telemarketing script.

Homeowner's Complaint Alleging A Lease-Buy Back Foreclosure Rescue Scam Among Several Being Probed By Connecticut AG

In North Stonington, Connecticut, The Day reports on a financially strapped homeowner who did business with a Massacusetts company that led him to believe that it would help keep him from losing his long-time family home.

• [Connecticut AG Richard] Blumenthal said in a phone interview that he is investigating [Gary A.] Gudat's case, along with other complaints involving a company called S.K.A. Properties Inc. of Attleboro, Mass., which Gudat alleges bilked his 76-year-old mother out of her nest egg and left him and a disabled sister, Debra Durocher, without a place of their own.

For the story, see Scam Cost Him His Home, Now He Wants Law Passed (Former N. Stonington man's case prompts Blumenthal to propose debt-reduction legislation).

See also, The Patriot Ledger: Debt reduction companies draw scrutiny (Conn. AG probing complaints about 1-2-3 Fix My Loan of Sharon and company in Attleboro):

• Connecticut Attorney General Richard Blumenthal is investigating complaints of predatory lending practices by a pair of Massachusetts companies. Blumenthal said he has received complaints about 1-2-3 Fix My Loan of Sharon and S.K.A. Properties of Attleboro.

***

• Mark Parker of Easton, the president of 1-2-3 Fix My Loan, said in an interview that he will no longer accept up-front fees from clients in Connecticut or Massachusetts. “We are changing our policy to meet their guidelines as per Blumenthal’s statement,” Parker said.
  Steven Dellacroce of Attleboro, who is listed as the president of S.K.A. Properties, does not have a listed telephone number.

Baltimore/D.C. Area High On Troubled Commercial Property Hit List

In Baltimore, Maryland, Baltimore Business Journal reports:

• The Baltimore-Washington, D.C. region ranks fifth in the nation for metropolitan areas hardest hit by the nationwide credit crunch, with more than 160 properties in financial trouble or at risk for foreclosure, according to a new study. Industry research firm Real Capital Analytics identified 162 distressed or potentially troubled assets in the region, representing more than $4 billion in commercial real estate.(1)

***

• Named in the report is General Growth Properties Inc., a Chicago-based real estate investment trust selling off a number of its marquee properties to raise money and pay down $900 million in debt scheduled to come due in February. Among the properties it has put on the market are Harborplace and the Gallery, two prime retail locations along Baltimore’s Inner Harbor.

For more, see Commercial real estate credit crunch lands Baltimore on troubled assets ‘radar.’

(1) Reportedly, the firm identified the properties as part of its Troubled Assets Radar. The tracking system was created to identify investment opportunities for interested buyers.

$100M Class Action Suit Filed Against L.I.-Based Loan Modification Company; Described As More Of A Sales Operation Than Professional Services Firm

In downstate New York, Crain's New York Business recently ran a story about American Modification Agency (AMA), a Long Island-based loan modification firm that, allegedly, has been the target of numerous complaints from homeowners claiming the company clipped them for thousands in upfront fees in exchange for failed promises of adjustments to the terms of their home loans to make their house payments affordable.

As part of the arrangement, the firm is accused of instructing the homeowners to cease making payments to, and ignore all communication from, their lender. White Plains, NY attorney Jeffrey Greene reportedly filed a $100 million class-action suit(1) against AMA last month and descibed the deal as, “It's like taking somebody's money and telling them to jump off a bridge.”

• [C]ourt papers and interviews with customers and former employees reveal a company that pulled out all the stops to bring customers in, but did little or nothing for them once it had their money. Phone calls went unanswered; untrained agents dissatisfied with paltry commissions resigned, leaving customers in the lurch; and homeowners received foreclosure notices despite guarantees that their homes would be saved.

• AMA claims to be the largest of a growing collection of mortgage modification firms that have sprouted up nationwide in the past two years as homeowners have battled to keep up with unaffordable subprime loans. The burgeoning industry has caught the eye of the FBI's New York office and the state attorney general's office, which are reviewing complaints.

• Former sales agents say working for AMA was a nightmare. They received no training or salary and relied on commissions of 15% to 25%. Many of the clients they brought in never had their loans modified by the firm's processors, with whom they were not allowed to speak. “We've had clients in for well over 150 days that aren't done,” says an agent who was hired off a Craigslist ad and worked at AMA for six months.

***

• Former employees say the company grew too fast, too soon and describe a frenetic, almost circus-like atmosphere in the office. They recall President Sal Pane riding around the office on a Segway scooter drinking Red Bull and exhorting agents to bring in customers.

• “Each time we'd turn in a file, we'd go out on the floor and hit a gigantic brass gong hanging from the ceiling,” says one former employee. “Everybody cheered one another, "yeah, yeah, yeah.'"

For the story, see No helping hand (Struggling families sue mortgage fixer AMA; paid but got nothing in return).

(1) Presumably, any evidence of possible wrongdoing coming out of this civil suit will come in handy for federal and state prosecutors (both in New York and in other states in which AMA operates) in deciding whether to bring their own cases (either civil or criminal) against the firm.

One More Arrested, Two Others Sought In San Diego-Area Alleged Land Patent, Foreclosure Rescue Scam; 17 Cheated Out Of $100K+, Say Prosecutors

In San Diego, California, the San Diego Union Tribune reports:

• Prosecutors are asking for the public's help in finding two people suspected of scamming homeowners in a foreclosure fraud scheme, officials announced Friday. Julita Whittingham and Edgardo Orcino are part of a group of people suspected of defrauding San Diego County homeowners out of more than $100,000 in 2007, prosecutors said.

***

• A third suspect, Jessica Refuerzo, 55, of Spring Valley, was found and taken into custody Friday, officials said. Prosecutors said the trio falsely promised to help homeowners who had defaulted on mortgage payments or who feared they would soon default by holding seminars in which they pitched their scheme.(1)

For more, see Authorities Seek 2 In Alleged Land Patent Scam.

For story update, see Man In Foreclosure Scam Pleads Not Guilty (Edgardo Orcino, 57, was arraigned after turning himself in at the downtown San Diego County Courthouse. Orcino, along with Larry Smith, Marguerita Gaviola, Maria Capa, Jessica Refuerzo and Julita Whittingham is charged in the alleged scheme. Whittingham remains at large, said Deputy District Attorney Marlene Coyne).

(1) Two other suspects in the case are in custody. Larry Smith, 60, has pleaded not guilty to felony charges of grand theft, conspiracy to commit grand theft and engaging in deceitful practices while acting as a mortgage foreclosure consultant. Prosecutors said Smith and the others sold “land patents” to homeowners facing foreclosure and told them that the patents would make them a sovereign nation that would be protected from the banks. At least 17 people fell for the scheme, prosecutors said, and lost tens of thousands of dollars.

Mortgage Servicers Feeling The Pain As Mounting Mortgage Delinquencies Drain Cash Reserves

Bloomberg News reports:

• Bank of America Corp., GMAC LLC, and WL Ross & Co. are among mortgage servicers that have endured billions of dollars in unexpected costs and added thousands of workers to handle rising foreclosures, denting a business once viewed as a safe haven from the housing market’s collapse.

***

• Servicers agree to advance cash to investors when borrowers are delinquent and get repaid when the loans are brought current or through foreclosure sales. [...] When late payments mount, servicers have to draw on their own reserves or credit lines until they conclude the loan won’t be repaid.

For more, see Mortgage Servicing Loses Luster as Bad Loans Mount.

Ohio Loan Officer Gets 20 Months For Role In Mortgage Scam Involving 365 Bogus Real Estate Closings, $13.3M+ In Illegally Pocketed Profits

In Dayton, Ohio, U.S. Attorney Gregory G. Lockhart (Southern District of Ohio) recently announced:

• Timothy Pearson, age 37, of Beavercreek, Ohio was sentenced to serve 20 months in federal prison, followed by three years of supervised release, and ordered to pay $171,211 in restitution to the Internal Revenue Service (IRS) for his role in a mortgage fraud scheme.(1) Pearson had previously been employed as a loan officer [...].

The press release reports that, according to court documents and testimony:

• Pearson directly and indirectly participated in at least 365 fraudulent real estate closings in the Greater Dayton area. Eight named and various unnamed co-conspirators fraudulently obtained in excess of $13.3 million for their collective personal use. Pearson personally derived $919,000 in gross receipts as part of this conspiracy.(2)

For the U.S. Attorney press release, see Local Mortgage Loan Officer Sentenced To Twenty Months For Mortgage Fraud.

(1) Pearson pleaded guilty to one count of conspiracy to commit money laundering and to two counts of income tax evasion, according to the press release.

(2) Reportedly, the scam involved basic, run-of-the mill, "Mortgage Fraud 101" maneuvers (ie. preparation and submission of fraudulent mortgage loan applications on behalf of prospective home buyers; fraudulently providing down payments for the homebuyers at the real estate closings ).

Court-Supervised Foreclosure Diversion Program Begins Monday In Allegheny County

In Pittsburgh, Pennsylvania, WTAE-TV Channel 4 reports:

• [B]eginning Monday, owner-occupied homes facing foreclosure will be specially flagged for attention, and the plaintiff will also have to identify the name, address and phone number of someone at the lender with authority to discuss the action.

***

• People will be put in touch with a nonprofit housing counselor free of charge to help try to work out arrangements with their mortgage company. The counselor will set up a conference under a judge's supervision to determine if they can work out an arrangement. [...] People entering the pilot project will get 90 day court stay of foreclosure while going through credit counseling and efforts to work out arrangements to save their home.

For the story, see Allegheny County Foreclosure Program Begins Monday.

Broome County Lawmakers To Address Mineral Rights Issue In Tax Foreclosures; Delinquent Homeowners Losing Natural Gas Rights When Curing Arrearages

In Broome County, New York, the Binghampton Press & Sun Bulletin reports:

• [Daniel D. Reynolds, the new chairman of the Broome County legislature] said he'll appoint a committee representing both parties in the next few days to look at Broome's practice of holding onto mineral rights to properties it obtains in tax foreclosure. The issue has been simmering for months, after three people retrieved titles to their properties after tax foreclosure proceedings but learned the county had taken away their rights to natural gas on their land.(1)

***

• The issue is important because oil and gas companies are paying large sums to obtain leases to mineral rights to properties on the Marcellus Shale formation, one of the largest deposits of natural gas in the United States.

For more, see Legislature chief targets mineral rights.

In a related post, see Upstate NY County Looks To Wrestle Away Mineral Rights From Tax-Delinquent Property Owner Who Has Since Paid Arrearage.

Go here for other posts on those looking to strip property owners of their mineral rights.

(1) According to the story, committee members will be appointed before the Jan. 27 meeting of the legislature, Reynolds said. The committee is expected to resolve the issue involving the three property owners before creating a new policy regarding who owns mineral rights after tax foreclosures. MineralRightsAlpha

Elderly, Penniless Mom Tells Judge To Jail Son For Home Equity Ripoff; Man Accused Of Abusing POA To Pocket Proceeds Of Reverse Mortgage On Residence

In Sarasota, Florida, the Sarasota Herald Tribune reports:

• An 82-year-old woman suffering from the mental and physical fallout of a stroke told a judge Thursday that her son should go to prison for stealing from her. About an hour later, her 61-year-old son was handcuffed, fingerprinted and sent away for two years.

• "Never in my life would I dream I would be in a position where my firstborn son hurt me," Barbara White said in a letter read aloud in court. "I am penniless and have had foreclosure suits filed against me."

• White's letter talked about the three years of suffering she has endured after finding out her son, Michael Garrett, took more than $80,000 from her. [...] A jury had convicted Garrett of using his power of attorney to give her a reverse mortgage on her home, then spend almost all the money on himself in 30 days.

For more, see Mother tells judge to imprison son (Michael Garrett was given a two-year prison sentence for stealing $80,000 from his mother).

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

Go here, here, here, here, here, and here for other posts on elder financial abuse. KappaDeedTheft FinancialAbuseOfElderlyAlpha

Saintfield Couple Cops Forgery Plea; Accused Of Ripping Off 94-Year Old, Blind Mother Of Her Half Of Residence; Civil Suit Expected To Undo Deed Theft

In Saintfield, Northern Ireland, the Belfast Telegraph reports:

• A man has pleaded guilty to a £100,000 fraud in which he and his wife left his blind 94-year-old mother without her home. Just moments after a jury was sworn in to hear the case George Ignatius Martin and his wife Mary Martin changed their plea and admitted forging land registry documents to transfer the elderly pensioner’s home into their name.(1)

***

• The fraud relates to a house at Downpatrick Street in Saintfield which the victim, Mrs Annie Martin, owned with her son George Ignatius Martin. [...] Mrs Annie Martin currently resides in a Belfast nursing home and civil proceedings are expected to be launched to have her share of the property signed back to her.

For more, see Son admits defrauding his mother of her home.

For additional Belfast Telegraph reports on this case, see:

• Family’s shame over son’s bid to swindle blind pensioner,
• Lawyer accused of cheating woman (94) out of her home.

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

(1) Reportedly, the Martins entered pleas to four charges of forgery and using false land registry documents with intent. Two charges of obtaining property by deception were not prosecuted, according to the story. KappaDeedTheft FinancialAbuseOfElderlyAlpha

Spokane Grandson, Girlfriend Jailed For Duping Grandma Into Signing Over Deed To Home; Then Filing Eviction Papers To Give Her The Boot

In Spokane, Washington, ABC News reports:

• At 83, Betty Halligan had lived a long and happy life, but after her husband died she needed extra care. Betty Halligan was suffering from dementia and diabetes, so her grandson Michael Halligan and his girlfriend Daphne Wood moved into her Spokane, Wash., home to help her out. Or so she thought.

• Betty Halligan's son, Dick Halligan, and his wife, Gail Halligan, lived in another state. At first they were happy that their mom had help, but later they became concerned when they learned she had signed over her power of attorney to their nephew. Dick Halligan was convinced his nephew was stealing from his mother.

***

• "They had convinced her to sign the deed to the house over to them, with the thought that they would stay and take care of her for the rest of life," Dick Halligan said. "As soon as the deed came in the mail, they started the paperwork to get an eviction notice to get her out of the house." With her life savings depleted and about to be evicted from her own home, Betty Halligan finally reached out to her daughter-in-law for help.

***

• Police raided the home and uncovered evidence that ultimately sent Michael Halligan and Wood to prison for more than two years. They were convicted of second-degree theft and forgery.

• Betty Halligan witnessed her grandson's trial and later moved to an assisted living center, where she lived until she passed away in June. "She was never the same after this," Gail Halligan said. "She died of disappointment and a broken heart."

For more, see Don't Give Power of Attorney to the Wrong Person (Will Power of Attorney Abuse Rise Because of Bad Economy?)

For ABC News video report, see Protect Against Thieving Relatives (Children and grandchildren are stealing from their senior citizen relatives).

Go here, here, here, here, here, and here for other posts on elder financial abuse. FinancialAbuseOfElderlyAlpha KappaDeedTheft

Foreclosed Elderly Cancer Patient, Wife Locked Out Of Home Without Eviction Hearing; Lender Denies Having Locks Changed

In Bronson, Michigan, WWMT-TV Channel 3 reports:

• An elderly couple that lost their home say that was bad enough, but now they've told Newschannel 3 that they have been locked out of their home and can't get their belongings, including medical equipment. Nobody seems to know why, and that's when [Henry and Ruthie Leaf] contacted [Newschannel 3] for help.

***

• Henry Leaf has the end of his life staring him in the face, so it's not the greatest time for the terminal cancer patient to be locked out of his home, but that's what he and his wife say happened. [...] Ruthie says that after being in and out of hospitals in late 2008, they finally came home in December to new locks, and all their stuff still inside. An attorney that has worked with them says the locks were changed in November.

• The company that foreclosed their home says it doesn't know who changed the locks. "I don't know what's going on to be honest," said Tom Maleski from Bond Corporation, "why the locks would be changed in November. If the locks were changed in November, nobody called me and told me that." Maleski also said no home-owner would be locked out until an eviction hearing. The Leaf's have their hearing on January 23rd.

***

• Branch County lists Northpointe Bank as the new owners of the home, but in a statement to Newschannel 3, Northpointe said they would have never ordered the locks to be changed. Meanwhile, the Leaf's tell us they never received any eviction or lock-out notification and are willing to let the house go, but they do want their stuff back.

For the story, see Locked out of their own home (read story) (watch video).

For story update, see A happy ending, after being locked out of their home.

Go here for other posts on improper foreclosure lock-outs and other lender screw ups. ForeclosureLockOuts