24 Dartmoor Drive: Representative Of Ever-Diminishing Value Of Collateral Securing MBS-Investor-Held Crappy Paper As Trustees, Loan Servicers Fiddle

Holders of investments in mortgage-backed securities ("MBS") who are curious as to how the collateral securing their crappy paper is doing and want to see an example of what their trustees and loan servicers are allowing to happen to said collateral can take a ride over to 24 Dartmoor Drive in Crystal Lake, Illinois, where the Northwest Herald reports:

• The house at 24 Dartmoor Drive in Crystal Lake is rotting from the inside out. Water damage from a burst pipe caused part of the ceiling to cave in and the wooden floors on the first floor to buckle. Neighbors can smell mold. There is a for sale sign out front, but no one is allowed in. City inspectors put a notice on the house saying it’s uninhabitable.
• This beige two-story house with a brown roof is one of more than 8,500 properties in McHenry County that have fallen into foreclosure since 2008. The circumstances of the house – and many others like it throughout the state – have become problems for which no one seems to want to take responsibility.(1) New legislation would change that, shifting the burden of security and maintenance of these homes to lenders.
• David and Sherri Modrzejewski – who live next to the dilapidated Crystal Lake home with their children – want it cleaned up. They worry the mold will make their boys sick. They have called the bank that owns the property, the listing agent, and the city of Crystal Lake. So far, little has been done. “It’s been really frustrating,” Sherri Modrzejewski said. “Everyone says their hands are tied.”
• The couple who lived at 24 Dartmoor Drive owed $191,107.59 on the mortgage. Foreclosure proceedings began March 30, 2009. The house was sold at auction in December 2009 to the highest bidder, Deutsche Bank National Trust Co., for $135,000, according to court records.
• Deutsche Bank National Trust Co., based in Los Angeles, said it is not to blame because it acts as a trustee, spokesman John Gallagher said. “Loan servicing companies, and not the trustee, are responsible for foreclosure activity, maintenance of foreclosed properties and resale of foreclosed properties,” he said.
• In May, the city of Los Angeles disputed such claims, calling Deutsche Bank’s subsidiary “one of the largest slumlords” in the city. The city attorney filed suit alleging that the international lender left dozens of homes and apartments to decay and illegally evicted tenants from foreclosed properties, according to The Associated Press.


• Litton Loan Servicing, Gallagher said, is accountable for the house at 24 Dartmoor Drive in Crystal Lake. The Houston-based company said it would look into the matter.

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• Local health inspectors visited the house, saw the damage and smelled the mold, said Debra Quackenbush, spokeswoman for the McHenry County Department of Health. The property trustee has been asked to inspect the home. Quackenbush said she didn’t know when that would happen. [...] The Health Department has had complaints about foreclosed homes in neighborhoods throughout the county.

For more, see Foreclosure ownership gaps leave ‘rotting’ homes.

(1) MBS-investor concerns over the tab for increasing costs and expenses associated with the handling of loan collateral is at the center of a recent lawsuit by an institutional investor demanding an accounting from their loan servicer. See Inflated Fees, Force-Placed Insurance, Robosigning Among MBS Investor Concerns In Suit Demanding Bankster Accounting Over Loan Servicing Costs.