Jacksonville Mortgage Broker Awarded Seven Years In Federal Pen In Cash Back Mortgage Fraud Scam Involving Inflated Sale Prices & Appraisals

The U.S. Attorney's Office, Middle District of Florida, announces:

• [Last week], U.S. District Judge Henry Lee Adams, Jr., sentenced Justin D. Barker, 31, of Jacksonville to seven years' imprisonment for his participation in a mortgage fraud scheme. After his release from prison, Barker will be on supervised release for five years. Barker entered a plea of guilty to conspiracy to commit wire and bank fraud on September 24, 2007. At his sentencing, Barker was ordered to pay restitution in the amount of $2,353,339.91 and to forfeit $4,419,024.15, jointly and severally with other conspirators.

***

• During the course of the scheme, fraudulent loans totaling about $17.7 million were obtained on more than 40 properties. These loans would not have been approved but for the fraud. Barker received approximately $4.4 million in gross proceeds from the fraudulent transactions. To recover some of these illicit proceeds, the government seized from Barker a 2004 Bentley Continental, a 2007 Cadillac Escalade, a 2002 BMW 745Li, a 2005 Chaparral 330 Signature 36' boat, a 1997 19' Wellcraft boat, a 2006 Yamaha motorcycle, a 2001 Yamaha motorcycle, a 2-carat loose diamond, a 1-carat diamond necklace, a .5-carat diamond necklace, diamond stud earrings, and two Movado watches.

For more, see Jacksonville Man Sentenced To Seven Years For Mortgage Fraud Scheme.

Oregon Lawmakers Pass Foreclosure Rescue Legislation

In Salem, Oregon, a news release from the Senate Majority Office of the Oregon State Legislature reports:

• The Senate [...] approved HB 3630 [Friday]. The bill will help Oregon families facing foreclosure by cracking down on mortgage “rescue” scams. Additionally, HB 3630 requires that mortgage lenders provide borrowers facing foreclosure with a written, plain language notice of the potential consequences of their situation and ways to avoid foreclosure. These pieces of legislation will help Oregonians when they need it most – when their homes are at risk and they are facing foreclosure.

For the news release, see Legislation promoting fairness for Oregon homeowners passed by Senate ( Enhanced oversight, crackdown on foreclosure ‘consulting,’ plain language requirements key pieces of Senate Democrats’ February agenda).

See also, New legislation helps Oregonians facing foreclosure.

Florida AG Gets Guilty Plea In Statewide Mortgage Fraud / Home Improvement Scam

In Central Florida, WFTS-TV reports:

• Attorney General Bill McCollum announced Monday that a former Hillsborough County resident was convicted of multiple charges of racketeering and conspiracy to commit racketeering and was sentenced to eight years in prison. Bradford C. Peck was the point person for a multi-million dollar mortgage fraud scam that stretched across the state and involved one of the nation’s largest sub-prime mortgage companies.

***

• "This scheme preyed on people who were trying to make improvements to their homes and instead were victimized and cheated out of not only the home repairs but also their hard-earned money," said Attorney General McCollum. "Without the cooperation of state and local law enforcement, this criminal operation might still be in business." Peck, 31, was part of a criminal enterprise which submitted nearly 130 loan applications to Argent Mortgage Company which resulted in funding for approximately $13 million in home loans. [...] The construction work, when provided, was often substandard and incomplete. [...] Argent executives and outside counsel cooperated with the investigation and assisted the victims in this case, many of whom were facing potential foreclosure actions.

For more, see Hillsborough man pleads guilty to mortgage fraud.

See also, St. Petersburg Times: Mortgage fraud figure gets 8 years in prison.

For Florida AG's news release, see Key Player in Mortgage Fraud Scheme Gets 8 Years in Prison (Statewide scheme victimized dozens of individuals).

Go here for earlier posts on this prosecution.

For other posts on builders & contractors accused of stiffing customers, go here and go here. contractors stiff subs customers zeta scott almeida

Title/Escrow Firm Owner Cops Plea In Scam That Siphoned Off $2.5M In Proceeds In Real Estate Deals

In Minnesota, the Minneapolis Star Tribune reports:

• A 50-year-old Chaska woman who had owned Profile Title and Escrow Corp. pleaded guilty Wednesday in a federal fraud and money-laundering scheme that siphoned off more than $2.5 million. Molly L. Heise had been sole shareholder and president of the title company in 2002 and 2003. It primarily closed loans on residential properties. Profile Title's underwriter, Chicago Title Insurance Co., required the company to deposit its mortgage loan proceeds into an escrow account at Eagle Valley Bank, where they could be monitored. But Heise secretly diverted substantial sums into an escrow account at EastBank and into an account at U.S. Bank, where she mixed personal and business money.

***

• Heise allegedly spent more than $2 million on houses, landscaping, a Hummer, a motorhome, a Wisconsin cabin and a boat. [...] The former chief financial officer for Profile Title, Christine Hein, pleaded guilty in the case last month. Hein admitted diverting nearly $135,000 from a secret escrow account for a down payment on her home in Buffalo.

For more, see Title company owner from Chaska pleads guilty in fraud case.

See Theft Of Escrow Funds I and Theft Of Escrow Funds II for other stories of trust account / escrow account theft of funds. sneaky slick escrow agents beta

Mortgage Fraud Cases "Streaming Through The Door" At One California DA's Office; Budget Shortfalls Make Staff Cutbacks Possible

In California, The San Jose Mercury News reports:

• The Santa Clara County District Attorney's Office has been hit with a surge in complaints about home-loan fraud, even as funding to prosecute these cases is plunging. The district attorney's office opened 125 new investigations into mortgage scams last year, four times as many as in 2006, prompting one prosecutor to call 2007 "the year of lending dangerously." The total loss to victims topped $40 million during the 2006-07 fiscal year, the office said. Funding to prosecute these cases is tied in part to the real estate market, so the slowdown in home sales has led to a drop in the amount of money coming into the district attorney's office.

***

• "The cases are streaming through the door, and we're doing our best to cover it," said Deputy District Attorney Mike Fitzsimmons, one of only two lawyers assigned full time to real estate fraud. Fitzsimmons said he's working nights and weekends to keep up with the volume. The budget shortfall could exacerbate the problem. If funding continues to decline, the office may have to cut staffing, the district attorney said in a report to the board of supervisors this month.

For more, see Santa Clara County prosecutors besieged by mortgage complaints (Funding For DA's Office To Fight Fraud Is Down).

Go here for the Foreclosure Rescue Warning Letter sent by DA's Office to homeowners receiving Notices of Default in connection with their home mortgages. The letter warns the homeowners about the onslaught of foreclosure rescue operators that they should be expecting and invites the financially strapped homeowner to report them to the DA's Office if they think a crime has been committed.

Three Banks Added As Defendants In Multi Million $ North Carolina Civil Fraud Case

In North Carolina, The Charlotte Observer reports:

• BB&T of Winston-Salem and two other banks from outside North Carolina were added as defendants Thursday to a multi-million dollar real estate fraud case. A fourth bank, First Charter of Charlotte, was not included in the suit because it is involved in a virtually identical court case in Mecklenburg County. The civil case involves the collapse of a 1,300-acre mountain development in Mitchell County known as the Village of Penland, about an hour northeast of Asheville. Attorneys for investors in the development argued Thursday in Wake Superior Court that the financing scheme used to sell lots at Penland was impossible without the banks' participation. The court's eventual decision is critical to investors because those who borrowed money are required to keep making payments on the loans even though the land is worth far less than the money they owe.

***

• A former bank investigator at BB&T also has filed a suit, alleging she was fired from her job for refusing to participate in a coverup of a $20 million loan fraud connected to Penland. And the N.C. Attorney General's Office has a suit pending against the developers of the project alleging securities and mortgage fraud. When the Penland development failed in May, dozens of investors owed the banks as much as $100 million. [...] The banks from outside North Carolina are United Community Bank of Georgia and Carolina First of South Carolina. All four have denied involvement, saying they were tricked by the developers and are victims of the fraud.

For more, see BB&T added to mountain fraud lawsuit.

Go here for other posts on the alleged scheme underlying the failed North Carolina Village of Penland project. Tony Porter

Convicted Securities Scam Artist Drifts Into Selling Reverse Mortgages While Waiting To Begin Prison Sentence

In Washington State, The Associated Press reports:

• The Spokane Spokesman-Review reports that a man convicted of securities fraud in Colorado has been selling reverse mortgages in Spokane, while waiting to begin his prison term. Michael Duane Smith is listed in a brochure issued by Golf Savings, a mortgage subsidiary of Sterling Savings Bank of Spokane. A spokeswoman said yesterday that he no longer works there. He was convicted of securities fraud in May in federal court in Denver for a scheme in which investors lost nearly $50 million. No sentencing date has been set. Smith's lawyer, Richard Stuckey of Denver, says Smith would have further comment. The Washington Department of Financial Institutions says Smith applied for a loan originator's license but was denied because of his felony conviction. He needs the license to work for a mortgage company, but not a bank.

Source: Man convicted of fraud sells reverse mortgages in Spokane.

For other posts related to reverse mortgages problems, go here , and go here. reverse mortgage yak

SEC Seeks Order Compelling Broker To Fork Over $6.9M For Selling Investments Tied To Subprime To Elderly, Others

In West Palm Beach, Florida, The Miami Herald reports:

• The Securities and Exchange Commission is asking a federal judge to order Hillsboro Beach securities broker Jamie Solow to pay $6.9 million for ''deceitful conduct'' that ravaged the accounts of his customers and put a firm that employed him out of business. [...] A civil jury in West Palm Beach found Solow liable late last month for running a fraudulent trading scheme in which he racked up huge commissions selling complex investments known as inverse floating collateralized mortgage obligations (CMOs).

• Solow's nine-day trial focused attention on a less-publicized aspect of the nation's expanding credit crisis -- the many average investors who lost big money after putting their retirement savings into volatile mortgage-related securities. Regulators have said such investments are only suitable for sophisticated investors who understand the risks. At trial, government prosecutors presented evidence that Solow, 46, used deception to peddle millions of dollars of those risky, mortgage-backed bonds to hundreds of retail clients looking for safe investments for their retirement accounts. Investors such as Tony Stevens, 81, of Sunrise, lost their entire life savings.

For more, see SEC wants broker to pay $6.9M for fraud (Government lawyers want a U.S. judge to throw the book at a South Florida stockbroker who preyed on the elderly while running up millions of dollars in commissions) (if link expires, try here).

For earlier Miami Herald story, Jury: Stockbroker liable for fraud scheme (The SEC said it will ask a judge to take steps to kick a Hillsboro Beach stockbroker out of the securities industry).

Salt Lake City Foreclosure Rescue Operator Facing Five Felonies In Dubious Sale Leaseback Deals With Financially Strapped Homeowners

In Salt Lake City, Utah, KUTV Channel 2 reports:

• A lot of people sign important documents without really reading them, but for an elderly Utah couple that oversight cost them their home. Emery and June Mitton were visited recently by the owner of a company called "Residential Resolve," which claims to help homeowners with financial troubles. In fact, the company motto holds, "We save homes."

***

• Seeking a resolution to their mortgage troubles, the Mittons eagerly paid attention to [Residential Resolve owner Jeff] Wangsgard's proposal. A short time later, Wangsgard then accompanied the couple to a bank and paid $13,000 toward their delinquent mortgage payments. After Wangsgard's grand gesture, the Mittons signed some documents on the spot without really reading over the fine print. What they didn't know was that one of the documents was an "assignment of beneficial interest and land trust" -- which essentially handed over the home and property to Wangsgard. Believing that the documents were merely an application for a new loan arrangement, the Mittons were shocked when, days later, Wangsgard showed up at their home with a locksmith and demanded that they leave. "He said, 'I'm here to evict you,'" June recalled. "'I'll give you some time to pack some clothes, then we are changing the locks.'"

***

• Apparently, though, several of Wangsgard's other "customers" were not OK with their deals. [Last] week, the "Residential Resolve" owner appeared in Davis County court and was charged with five felonies stemming from his dealings with the Mittons and other clients. The charges against Wangsgard include communications fraud and exploitation of a vulnerable adult.

• "Other people came forward," said assistant state attorney general Charlene Barlow. "If you have one occurrence, maybe someone is confused. But when you have two or three different people coming forward... it's a much easier case to present to a jury." The charges against Wangsgard are a direct result from the Mittons' case and two others that are similar in nature.

For more, see How A Utah Couple Was Kicked Out Of Their Home By Mortgage "Helper." (read story) (watch video).

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

Go here and go here for criminal prosecutions of foreclosure rescue, refinancing, and other deed scams. whale

Buffalo Mayor Vows Action On Foreclosing Lenders Who Saddle City With Demolition Costs On Vacant Homes; Announces Suit Against 36 Banks To Recover $2M

In Buffalo, New York, The Buffalo News reports on Mayor Byron W. Brown and his State of the City speech last Thursday. Buried in the story is this highlight from the mayor's speech:

• A crackdown on banks that hold mortgages on vacant properties that are in foreclosure and saddle the city with demolition costs and other expenses. Brown said the city filed a lawsuit Thursday seeking to recover up to $2 million in costs from 36 banks that have mortgages on 57 properties.

For the entire story, see Mayor Brown paints the picture of a city on the upswing ($4.5 billion in projects completed or now under way).

To view Buffalo's lawsuit against a host of lenders on account of the blight caused by the abandoned houses in foreclosure, see City of Buffalo v. ABN Amro Mortgage Group Inc., et al. (3.67 MB; available online courtesy of the law firm Skadden, Arps, Slate, Meagher & Flom LLP). If there's a problem with this link, email me at HomeEquityTheft@yahoo.com and I'll email it to you (please put "City of Buffalo v. ABN Amro" in the subject line).

Go here for other posts on the City of Buffalo lawsuit against lenders abandoning foreclosed properties.

Florida Bank Accused Of Hiding Losses On Sour Mortgage Loans

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

• Freedom Bank lost $5.8 million in 2007, a major hit for the 21/2-year-old community bank. But it may be worse. Freedom's former senior lending officer has accused the bank of concealing its true financial condition by downplaying its bad loans. In a lawsuit, Mark S. Williams claims he quit the Bradenton-based bank last month after being pressured to understate its problem assets. Williams, who was also the bank's executive vice president, calculated that the bank needed to expense $11 million in the fourth quarter to downgrade and reserve for bad loans and real estate it owned from foreclosed borrowers.

***

• In his lawsuit, Williams says an unidentified member of Freedom's board of directors urged him several times to shred his original report that recommended the $11 million in loan-loss reserves. He also says [Freedom president/chief executive officer Gerald] Anthony forced him to fire two loan officers so they could not talk to incoming examiners from the Federal Deposit Insurance Corp.

For more, see Bank accused of hiding losses (A former Freedom Bank executive alleges pressure to downplay bad loans).

Florida Builder Countersues Lender In Foreclosure Action; Subs, Prospective Homebuyers Still Holding The Bag

In Vero Beach, Florida, TC Palm reports:

• Seacoast National Bank and its Indian River County president, Jay W. Hart, are to blame for leaving homebuyers and contractors in the Eagle Trace subdivision out hundreds of thousands of dollars, according to documents filed in circuit court this week. In a countersuit against Seacoast and Hart, Mizner Grande of Vero Beach claims the bank breached its duty as a lender in a “willful and wanton” manner when it stopped loaning money on the 106-home development [...]. Seacoast acted in December to foreclose on the 40-acre subdivision, claiming the developer failed to repay loans and credit lines.

***

• According to the suit, Hart and former attorney Ira C. Hatch Jr., who represented Seacoast in loan negotiations, made false promises to Mizner Grande [...]

***

• Hatch, who is not a defendant in the suit, sits in Indian River County Jail in lieu of $3 million bail on 55 criminal counts ranging from money laundering to racketeering in connection with his defunct company, Coastal Escrow Services, and former law firm Hatch & Doty. [...] None of the charges are related to Eagle Trace.

***

• Meanwhile, several homebuyers in Eagle Trace have sued Mizner Grande for their deposits and have filed complaints with state regulators. Subcontractors also have sued Mizner Grande seeking payment for work performed in the development. Several companies have filed liens against the property totaling $1.2 million.

For more, see Lawsuit alleges bank breached its duty, made false promises in Indian River County.

For earlier Jan.31 TC Palm report on this story, see 40-acre new home project in jeopardy in Vero Beach.

Race Biased Code Enforcement Actions Used To Force Out Poor Black Tenants, "Placate Racist Constituents," "Further Political Agendas," Says Suit

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

• An Eagan man who owned and managed low-income apartments in St. Paul has sued the city, alleging that officials subjected his buildings to "discriminatory and illegal" code enforcement actions designed to hurt his business and get poor black residents to move elsewhere. In the suit filed in federal court in Minneapolis on Friday, Robert McCampbell, 52, and his company, Raven Property Management, outlined what he called a "confrontational, heavy-handed approach" to low-income landlords through its so-called problem properties code enforcement. The city's actions drove McCampbell to lose money and tenants and eventually forced him into foreclosure, he claimed.

• In contrast, McCampbell alleged, the city had a "cozy" relationship with the St. Paul Public Housing Agency, subjecting it to a much lower standard of code enforcement. The housing agency runs about 4,200 federally subsidized units for low-income tenants throughout St. Paul.

***

• McCampbell cites federal housing and civil rights violations and violations of state business laws. The suit seeks compensatory damages, attorneys' fees and injunctive relief to keep the city from "continuing its wrongful conduct."

For more, see St. Paul landlord files racial-bias suit, alleging city sought to drive out low-income black renters, their landlords (It says city sought to drive out poor black tenants, their landlords).

See also Minneapolis Star Tribune: St. Paul sued on housing enforcement (An Eagan property manager alleges city leaders are trying to keep out poor tenants. An official says that's not happening).

To view the Federal lawsuit and the detailed allegations, see Complaint - McCampbell v. City of St. Paul ("Certain of defendant's officials and code enforcement officials and inspectors pursued discriminatory code enforcement operations to placate racist constituents and to further political agendas." - at paragraph 13). race bias predatory lending

NBC Today Show On Miami's Foreclosure District

NBC's Today Show ran a piece last Friday featuring a section of Miami, Florida that, with reportedly 23,000 condos currently on the market and another 25,000 new units slated to come on the market in the short term, is referred to by area real estate agents as Miami's "foreclosure district." From condo owners desperate to unload their units, to others going into foreclosure, to developers demanding refunds of prepaid commissions from real estate agents on deals where the condo buyer has backed out of his/her purchase contract, this niche of the market sounds like a horror show with the worst yet to come. The one positive point in the story was that, with units selling at steep discounts coupled with the highly inflated value of the euro, some European investors are coming over and making buys at prices that reportedly amount to buying at 50 cents on the dollar. To watch the piece, see Miami Monopoly (regrettably preceded by a 15-30 second TV commercial).

For related stories, see Reuters News service:

• Banks taking back Miami homes at high rate: broker ("Private equity and hedge funds from Canada, Europe, the Middle East and Asia -- buoyed by their own strong currencies in relation to the U.S. dollar -- are showing interest in bulk purchases of south Florida apartments"),
• Miami condos are "for sale" for foreign buyers ("Realtors, analysts and buyers say the strength of the Canadian dollar, the euro and other foreign currencies, on top of a falling real estate market, is making the United States an enticing place for foreigners looking to buy property").

For an earlier post on the trouble facing Miami's real estate market, see 191 Condo Projects Make Miami-Based Bank's "No Mortgage" Blacklist.

Go here for other posts related to the Miami condo market problem.

Prospective Tenants Beware: "It's More Important Than Ever To Do Your Homework" When Renting From A Landlord

In Lee County, Florida, WBBH-TV Channel 2 reports:

• If you're renting instead of buying and think you can't be foreclosed on, think again. Realtors say they're seeing an increase in renters being evicted as a direct result of the foreclosure crisis in Southwest Florida.

***

• Realtors say there are literally thousands of rental properties available in Southwest Florida, but finding out which ones are going into foreclosure requires a lot more homework than just calling the number on the sign.

• Real estate attorney Kevin Jursinski recommends asking your potential landlord some tough questions. "I'd ask the owner, are you current on your mortgage?" said Jursinski.
  Have the owner show you the paperwork to prove it. You should also go to the property appraiser’s website to find out if the landlord actually owns the home you’re renting.
  Then go to the county clerk’s website to find out if there are any lawsuits against the owner. You should also call the condo association or homeowners association to find out if they are up to date on their dues. Jursinski has one final tip. "You can go to sunbiz.org. It will tell you if there's any judgment on them throughout the State of Florida," he said.
  With today's real estate slow down, it's more important than ever to do your homework. "If you don't do that, you could have a problem," said Jursinski.

For more, see NBC2 investigates: Renters and foreclosures.

For posts involving rent / equity skimming landlords who pocket rent and allow homes to go into foreclosure, see Tenants Unwittingly Renting Homes In Foreclosure I , II , III , IV , and V. equity skimming unwittingly epsilon

Subprime Foreclosure Crisis Swamps Non-Profits

The National Catholic Reporter reports:

• The subprime mortgage crisis plaguing the nation’s economy has put extreme pressures on Catholic agencies in many parts of the country, swelling caseloads for counselors scrambling to help borrowers avoid mortgage foreclosures and upgrade financial skills. Where foreclosures cannot be avoided, groups are helping families find other housing, or seeking creative solutions to keep them in homes they can no longer afford.

• Dave Pesch, the housing counseling program manager at Catholic Charities of Erie, Pa., said his staff of four counselors can’t keep up with the flood of clients in danger of losing their homes in the wake of the subprime mortgage mess. “We have counselors working seven days a week,” he said. “We are overwhelmed.” Pesch’s office, like several Catholic Charities affiliates across the country, advises clients on how they can avoid foreclosure and negotiates with homeowners’ banks to work out refinancing or payment plans to keep clients in their homes. In some locations, such as Erie and St. Louis, the caseload has doubled or tripled in the past two years. “It’s like a ship that starts to take on water.”

For more, see Subprime loan crisis swamps agencies (Housing advocates scramble to assist clients facing foreclosure).

Indiana Jury Nails Loan Broker For Swindling Clients Out Of $200K+

In Hendricks County, Indiana, The Indianapolis Star reports:

• An Indianapolis man faces more than 25 years in prison after a Hendricks County jury found him guilty Tuesday of swindling clients out of more than $200,000. Jason Keigley, 35, was arrested last year after a lengthy investigation involving the Indiana secretary of state's office. Keigley, then-owner of 1st Place Mortgage in Indianapolis, used a complicated mortgage scheme to raise money for investments. [...] After two hours of deliberation, the jury found Keigley guilty of selling unregulated securities, transacting business by an unregistered broker-dealer, fraud in connection to the offer or sale of a security, and loan broker fraud, all felonies.

Among the victims was one who "[lost] everything he had worked for all his life," according to the prosecutor in the case. For more, see Ex-broker convicted in loan fraud case.

See also, Man Found Guilty of Mortgage Fraud.

Go here for earlier post on Jason Keigley.

Busting Indoor Pot Farms Becoming As Routine For Some Cops As Waking Up In The Morning & Brushing Their Teeth?

In Collier County, Florida, the Naples Daily News reports:

• For investigators from the Collier County Sheriff’s Office, busting a marijuana grow house is becoming as much a part of their daily routine as waking up in the morning and brushing their teeth. For the third time in four days, investigators busted a grow house on Friday in Golden Gate Estates, confiscating more than $200,000 worth of pot along with several thousand dollars worth of growing equipment, the Sheriff’s Office reported.

• "This is like Groundhog Day. Get up, go to work, go to a grow house," said Lt. Nelson Shadrick of the Sheriff’s Office’s Vice and Narcotics Bureau, referring to the Bill Murray movie where the main character repeats the same day over and over again.

***

• The bust comes three days after investigators uncovered 81 marijuana plants valued at nearly $250,000 at [one] grow house, and two days after they found 136 plants valued at about $408,000 inside [another], both in the Estates. [...] Friday’s bust was the seventh suspected grow house to be discovered in Collier County in 2008.

For more, see Busting grow houses becoming daily routine for authorities.

For a related story, see Indoor pot plant operations are a growing problem in Southwest Florida ("Growhouses tend to bring many dangers to the neighborhood, authorities said, including poisonous fumes, power outages, environmental damage, increased risk of fires, increased crime and violence.").

Go here and go here for other posts on Marijuana Grow Houses.

Go here for links to other recent news stories on indoor pot farms. pot grow ops alpha

Cops Charge S. Florida Man In 15-Home Indoor Pot Farm Operation; Allegedly Paid Straw Borrowers $10K To Finance Home Purchases

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

• El Jefe is in the county jail without bail, authorities said. Marijuana growers used the name — Spanish for "The Boss" — for Miguel Fernandez, who ran a $7 million drug empire from about 15 grow houses, mostly in the Loxahatchee area, according to the Palm Beach County Sheriff's Office. Fernandez, 45, of Hialeah, was booked into the county jail Thursday on a charge of a continuing criminal enterprise involving drugs. [...] "He was the major player in Palm Beach County as far as the cultivating and growing of marijuana," said assistant statewide prosecutor Luis Martinez. "The main guy is done. We have crippled the organization because we have taken him out."

***

• Fernandez, who has no criminal record in the state, set up and ran grow houses that contained growing chemicals and crude electrical wiring, investigators say. "It is a complete health hazard," Martinez said. "Right next door you have a regular family living there."

• Fernandez got so many houses by "purchasing someone's credit," according to the arrest report. He would pay $10,000 to use someone's credit and apply it through his connections with mortgage brokers and title companies, the arrest report said. "Miguel will also pay up to $2,000 per pound to the worker if he or she actually owns the home and lives there to tend the crops," Sheriff's Agent Aron Vento wrote.

For more, see Hialeah man accused of running 15 'grow houses' around Loxahatchee.

See also, Palm Beach Post: Informant helps sheriff's office bust grow houses.

Go here and go here for other posts on Marijuana Grow Houses.

Go here for links to other recent stories on indoor pot farms. pot grow ops alpha

Add The Neighborhood Fire Hydrant To The "Coveted List" For Some Copper, Metal Thieves

In Yucaipa, California, the News Mirror reports:

• Vandals have stolen more than $10,500 worth of fire hydrants, brass valves and copper wiring from Yucaipa Valley Water District during the past six months, according to district officials. These thefts, when combined with the labor costs involved in replacing the stolen equipment, could cost the district's customers as much as $15,000. [...] “I only know of two fire hydrants being stolen from the district in the past 33 years,” [the district's operations manager Charlie] Bailey said. “But we've had nine fire hydrants stolen in the past six months alone. This is clearly happening because of the significant increase in brass and copper scrap values.”

For more, see Vandals steal $10,500 worth of copper, fire hydrants and more.

For other stories on stolen copper, see Copper Thefts I and Copper Thefts II. copper metal theft yak

More Incidents Involving Abandoned Foreclosure Pets

In Gwinnett County, Georgia, the Atlanta Journal Constitution recently ran a story on the increase in foreclosure pets in the area. A couple of excerpts:

• One abandoned dog Lt. Mary Lou Respess can't get out of her mind is a Chihuahua. He'd been tied up so long, said the Gwinnett County Animal Shelter manager, his collar had gotten embedded in his skin and had to be surgically removed. He's one of hundreds whose owners have left them behind.

***

• Joey Brooks, one of two cruelty investigators with Gwinnett County Animal Control, said he's definitely getting more calls about abandoned pets — usually dogs. He responded to one call about two weeks ago, he said. The power was turned off and so was the water. But three labs were tied up in the back yard. Neighbors had been feeding the dogs in this "decent neighborhood in Duluth," he said, but there was already a real estate sign out front. "That's what's weird," Brooks said. "We'll come across ones where [For Sale] signs are already in the front yard, but pets are still tied up out back." [...] Even that's preferable, Brooks said, to finding former pets trapped inside houses, without food or water or any way to get outside to do their business.

***

• [Homeowner] Steve Miller who lives outside Norcross in unincorporated Gwinnett, said the problem of abandoned dogs hit too close to home last week. On Friday, a pair he believes were left behind by a neighbor killed one of his cats. He'd been calling animal control all week, Miller said. But it wasn't until he reported the dogs had killed his cat Curly that an officer came out and caught one of the dogs, he said. The other dog hasn't been seen since.

For more, see More pets being abandoned after foreclosures.

For more on foreclosures and abandoned animals, see Foreclosures & Pets I and see Foreclosures & Pets II. petsII and foreclosures

NY Times Story A Reminder That Housing Discrimination Against Attorneys May Be OK In Some Cases In NY

In a recent New York Times article on a husband and wife attorney team who sued their neighbor who lived across the hall from them in a New York City cooperative apartment building because of second hand smoke that was allegedly wafting into their apartment, the article provides a word of caution to attorneys in New York when seeking approval to buy/occupy an apartment in a condo or co-op apartment building who have no qualms about suing their neighbors:

• Anthony vanEyck Miller, a vice president of Bellmarc Realty, says [co-op and condo] boards don’t mind lawyers, but he warns buyers about using the word “litigator” on applications. “It is almost pejorative in the context,” he said. “It is not quite as bad as terrorist, but it makes people nervous.”

• Felicia de Chabris, a broker at Halstead Property’s Greenwich Village office, said that lawyers are usually approved, especially if they are helpful and show humility. But she pointed out that a pattern of past lawsuits could pose a problem, especially when suits have been filed against neighbors or co-ops or condo boards. “Sending a quick legal letter is one thing,” she said. “Actually litigating is not a good idea.”

• [While] a 1977 court decision upheld a landlord’s right to refuse to rent to a lawyer, the city’s human rights law was amended in 1986 to bar discrimination in housing on the basis of a lawful occupation. Co-op and condominium boards may, however, reject lawyers and other applicants based on specific actions — for instance, a pattern of filing lawsuits against neighbors.

For more, see Neighbor vs. Neighbor.

Trouble Unloading Inventory Results In Foreclosure Action For Chicago-Area Condo Converter

In Cook County, Illinois, Crain's Chicago Business reports:

• NorthSide Community Bank has filed a foreclosure lawsuit to collect $3.5 million on a loan to a Rogers Park condominium converter. The Gurnee-based bank alleges that a venture managed by Greenlight Development LLC failed to pay off a loan [...] when it came due Dec. 29, according to a complaint filed Jan. 31 in Cook County Circuit Court. Mark Greenberg, president of Chicago-based Greenlight, said seven of the 30 units in the building have been sold and another is under contract. He declined further comment. Mr. Greenberg bought the 1930s-era property in June 2006 for $3.4 million, or $113,333 per unit. NorthSide financed the project, which included a renovation of the property, with loan that had an original balance of $4.7 million.

For more, see Foreclosure suit filed on Rogers Park condo conversion.

Go here for details of several other Chicago-area condo developers who appear to be holding the bag on their projects, see Foreclosures on condo projects rise.

Minneapolis City Council Advisory Panel Recommends "Putting The Squeeze" On Foreclosing Lenders, Landlords In Attempt To Address "Empty Home Epidemic"

In Minnesota, the Minneapolis Star Tribune reports:

• With foreclosures exploding, Minneapolis City Hall is stepping up the pressure on housing violations. A City Council panel Wednesday took three actions aimed at problematic properties as the number of new foreclosures in the city last month hit 344 properties. The committee recommended that the full council:

1. Revoke a rental license for an unprecedented 45 rental properties associated with Roseville-based TJ Waconia, a firm that the FBI has said it is investigating for mortgage fraud,
2. Triple the annual fee charged against vacant and boarded housing to $6,000 in an effort to recover some of the city's costs for dealing with them,
3. Impose a new $1,000 fee on residences that convert to rental units that intended to pay for an immediate inspection to make sure they meet the city's rental licensing standards.

• Besides running a $1.4 million problem properties unit, the city incurs police, fire, rubbish cleanup and other expenses at vacant houses, Inspection Director Henry Reimer said. Total costs exceed $2 million. [...] The full council plans to act on the recommendations at its Feb. 29 meeting.

For more, see Minneapolis puts squeeze on problem housing (With foreclosures booming, City Hall recommended three actions to combat the empty-house epidemic).

Sleazy Notary Authenticates Phony Lien Causing Home Sale To Fall Thru; Homeowner Awarded $40K In Damages

In Dallas, Texas, CBS11 News reports:

• A Texas notary authenticates wills, deeds and all sorts of legally binding documents. There are more than 400,000 notaries in our state and almost all of them are law abiding people. But as Michael Kloster found out, one bad apple can make your life a living nightmare. "This cost us three years out of our lives," said Kloster. According to Kloster, it all started when a notary stamped her seal on a mechanics lien and filed it in Collin County. The problem, according to Kloster and a judge, was that the lien was a fraud. "Six bucks and a notary; they filed a lien, and you don't have to approve a thing," said Kloster. What notary would sign off on such lien? Lourdes Medina admits she did just that. According to records, Medina signed for her husband, and then notarized the lien document. Her husband owned a roofing repair company and Kloster said the Medina's were never contracted to repair the roof. The Medinas filed a lien on his house. Medina admits that she "wasn't supposed to sign for someone that I know" and admitted to signing her husband's name on the lien.

***

• Court papers show a judge removed the lien on the Kloster's home and Medina voluntarily surrendered her notary license. The court awarded the Klosters more than $40,000 dollars in damages.

No word if a criminal investigation has been opened. For more, including other incidents of bogus notarizations found by CBS 11 News, see How Notaries Can Take Your Land, Money, Home (read story) (watch video).

Dallas-Area Roofer Rips Off Over $500K In Deposits, Failed To Do Any Work, Say Homeowners

In Dallas, Texas, CBS 11 News reports:

• A CBS 11 investigation exposed a roofing contractor who stirred up a financial storm in the wake of last years hail storm. [...] Roofing contractor Shawn Tatum came calling after that hail storm. He allegedly defrauded customers out of more than half a million dollars. [Homeowner Richard] Stewart and dozens of other customers gave Tatum their insurance settlement checks to buy materials for a new roof. Tatum cashed Stewart's check for more than $6,500, but Stewart got nothing in return.

***

• Tatum has since filed for bankruptcy. He claims customers owe him more than a half million dollars, even though he cashed their checks and didn't do the work, according to court testimony. More than two dozen former customers and suppliers faced off against Tatum in Fort Worth at the bankruptcy court last month. Tatum appeared to have a massive memory failure. In response to nearly 100 questions, Tatum replied "I can't recall." Tatum proudly testified that in four years as a roof contractor, he never handled a hammer.

***

• Tatum's customers say he is trying to use bankruptcy to get out of paying back their money. The Tarrant County District Attorney has told them that it has opened an inquiry into his roof contracting business while the Colleyville Police Department continues its theft investigation.

For more, see Roofing Contractor Stirs Up Financial Storm (read story) (watch video).

For other posts on builders & contractors accused of stiffing customers, go here and go here. contractors stiff subs customers zeta

Rights Of California Tenants Facing Foreclosure Evictions Depend On What City They Live In

A recent column in the Los Angeles Times on tenants being forced from their rented homes as a result of their landlords being foreclosed on contained this excerpt:

• State officials said that under California law, existing rental agreements are essentially wiped out when a property is foreclosed upon. All that's required is that a tenant be given at least 30 days' notice that he or she is being evicted.

• But those officials also said that state law can be trumped by local rent-control statutes, which often provide tenants with more far-reaching protections. These "just cause" provisions of many municipal rent-control laws limit the ability of landlords to evict tenants, even those on month-to-month leases. They also include cases in which ownership of a property changes hands, such as a foreclosure.

• "Tenants cannot simply be evicted," insisted Adam Radinsky, who heads Santa Monica's consumer protection unit. "There's no question about that."

• Actually, it depends on where you live. Cities with "just cause" provisions include Los Angeles, San Diego, Santa Monica, Thousand Oaks, West Hollywood and Glendale. However, not all "just cause" provisions are created equal. San Diego's requires that a tenant occupy a property for at least two years before the provision takes effect. Glendale's allows an eviction to proceed if the landlord plans to remove the property from the rental market or have a relative move in. Moreover, not all rental properties may fall under a city's rent-control protections. In such cases, state law would probably apply, which would allow a foreclosure-related eviction to go ahead. "In that case, the tenant may be in a really lousy position," said Al Shelden, chief of consumer law in California Atty. Gen. Jerry Brown's office. "There may not be many rights to begin with."

For more, see Shadow victims of the mortgage crisis: renters (if link expires, try here).

See also, KCBS Channel 2, Los Angeles: Money 101: Tenants Caught In Foreclosure.

Go here for other posts referencing California municipal "just cause" eviction laws.

For posts involving rent / equity skimming landlords who pocket rent and allow homes to go into foreclosure, see Tenants Unwittingly Renting Homes In Foreclosure I , II , III , IV , and V. equity skimming unwittingly epsilon

Bakersfield Broker's Flipping Operation Back In The News

The Bakersfield Californian reports:

• The mother-in-law of Realtor David Crisp, Leslie Sluga, recently had two homes enter default, property records show. The delinquent loans are a first for Sluga, although scores of defaults and foreclosures have touched other family members of the former Crisp & Cole Real Estate company's staff and business associates over the past year.

***

• [A California Department of Real Estate] complaint alleged Sluga and her daughter, Jennifer Crisp, were allowed by Crisp & Cole to report false employment information on loan documents. [...] The women reported nonexistent positions at Crisp & Cole and the accounting business owned by Sluga's husband, state regulators allege.

***

• Two days after the state complaint was filed, FBI and federal tax agents raided 13 sites around Bakersfield related to [the now-defunct real estate brokerage] Crisp & Cole. That investigation is ongoing. No charges have been filed. Crisp and his former business partner, broker Carl Cole, have left a string of at least 107 troubled properties carrying more than $66.6 million in loans in the wake of their defunct company's operations, according to an ongoing Californian tally. As of Friday, at least 80 of those have foreclosed, the Californian's research found.

Crisp has not been charged with any crimes, but reportedly is the subject of a Federal investigation. For more, see Crisp relative's homes in default.

See also, KGET-TV Channel 17: Radio host questions embattled realtor outside restaurant:

• An ambush interview with embattled realtor David Crisp has become the talk of the town online. A local radio personality grabbed a camera and confronted Crisp after spotting him at a local restaurant. KRAB radio host Francis Mayer said when he saw Crisp eating at [a local eatery] Monday, he had to ask him some questions.

Go here for past Bakersfield Californian stories about the Crisp & Cole home flipping operation.

Go here for earlier posts on David Crisp and his alleged flipping operation.

New Texas Law Requires Disclosure Of Meth Lab History In Sale Of Home; May Be Too Late For A Few Dallas-Area Homeowners; Foreclosures Exempted

In North Dallas, Texas, CBS 11 News reports:

• Imagine buying your dream home, only to learn that the walls are coated in toxic residue. A new Texas law aims to prevent home buyers from making a potentially dangerous mistake. But CBS 11 News learned that there's a loophole that could leave families in the dark. [...] A North Dallas homeowner, who does not want to be identified, learned of her house's hidden history through photographs. She never imagined it once concealed a meth lab. "Do you worry at all about what the health effects could be?" CBS 11 News asked. "Well, I've had two miscarriages in the last two years, so yeah," she answered.

***

• [C]BS 11 learned that the buyer only gets that information when the seller is a person, not a bank. That's because the disclosure form does not apply to foreclosure sales, according to Texas Property Code. If you buy a house from the bank, they don't have to tell you anything about the house's history. [...] The exemption means the law would not have helped Laura Budge, a Fort Worth mother of seven. Neighbors divulged the drug habit of a former owner, but Budge had no idea her family could be in danger. [...] Now the Budge family and others live with that fear and few options."It's not like we can just turn around and leave," Budge said.

For more, see Was Your New Home Used As A Meth Lab? (New Law Requires Sellers To Disclose Whether Home Was Used As Meth Lab; Some Experts Question Law's Effectiveness) (read story) (watch video).

Go here for some methamphetamine information resources.

Go here and go here for other posts on home-based methamphetamine labs. meth lab yak

City Anti Foreclosure Blight Ordinance Requires Registration Of Repo'd Homes; Can Assess Fines Up To $100K Per Home; Enforceable As Tax Lien

In Murrieta, California, The Press Enterprise reports:

• Murrieta on Tuesday became the latest city in California to target financial institutions for blight when a home falls into foreclosure. The City Council unanimously voted for a new blight ordinance that requires lenders to maintain a property that has been abandoned or foreclosed. [...] The law is meant to prevent "the broken window syndrome," where vandals and squatters choose homes to party or live in by finding signs of abandonment.

***

• The law requires that when a property is foreclosed upon or is abandoned, the lender must register the property with the city. The registration fee is $70. [...] The fines range from $250 a day for dead lawns or graffiti to $1,000 daily for fire hazards or squatters. The city can assess as much as $100,000 per parcel or structure that will be tacked on as a tax lien and paid to the city when the property is sold. The program is expected to begin in April. The city's proposed blight law is a variation of others used in Chula Vista, Orange County and Riverside.

For more, see Murrieta measure requires lenders to maintain foreclosed homes.

See also, North County Times: Murrieta cracks down on maintenance of foreclosed homes ("[C]ity officials took action Tuesday to curb blighted yards, unsafe neighborhoods and virtual welcome mats for squatters.") squatter foreclosure zebra

"Queen" Of Alleged "Happy Greek" Cash Back Mortgage Fraud Operation Charged By Cops

In Delaware County, Ohio, The Columbus Dispatch reports:

• A Columbus restaurant owner has been charged with running a multimillion-dollar mortgage-fraud ring that prosecutors say operated with help from dishonest appraisers and unethical, or ill-informed, brokers. Powell police officers arrested Gihan "Gigi" Zalat, 40, of Columbus, on Friday at the Happy Greek restaurant at 1552 N. High St.[...] which she co-owns with her husband. Zalat is charged with engaging in a pattern of corrupt activity and is being held in the Delaware County jail under a $1 million bond. Assistant Prosecutor Bill Owen described Zalat as "the queen" of a mortgage-fraud ring and said investigators have linked her to six illegal transactions in Delaware County.

***

• In each case, the homes were grossly overappraised by "less-than-honest appraisers" and financed by lending institutions, Owen said. But because of the over-appraised value of the homes, thousands of dollars were kicked back to the buyers after they purchased the home under the guise of home-improvement money. Many of the properties were bought with no money down, and the homes remained vacant.

For more, see Arrest made in fraud ring (Columbus restaurateur charged in mortgage scam).

For story update, see Pair face 14 counts in mortgage-fraud case (2-22-08).

For an earlier post on this alleged fraud operation, see The "Happy Greek" Restaurant - Home Of The $5.50 Gyro Sandwich (and "Cash Back" Mortgage Fraud Operation?).

N. Myrtle Beach Condo Project In Foreclosure; Deposits, Escrow Funds Missing; Developers Subject Of Federal Investigation

In North Myrtle Beach, South Carolina, the Myrtle Beach Sun News reports:

• Jeff Shoup and Tommy Hix are counting on a proposed sale of the Bahama Island property here to repay investors, but court documents and financial records show a sale might not generate enough money to replace all of the escrow funds missing from the developers' bank accounts.

• At least $30 million in bad loans, unpaid bills and missing deposits are owed by Shoup and Hix, who now are the focus of a federal investigation. Among the missing money is at least $7.3 million in deposits from condominium and marina investors.

• Bank records show most of that money was spent by Shoup, Hix and their nearly 60 corporations, including T&J Development of North Myrtle Beach. The 22-acre Bahama Island property, located west of the Intracoastal Waterway at about 13th Avenue North, is in foreclosure because Shoup and Hix did not make payments on a $7.6 million mortgage given to them by National Bank of South Carolina.

For more, see Sale Unlikely To Reach All Open Hands.

For story update, see Millions in doubt in resort sale (Investors unsure of reimbursement) ("A proposed sale of the Bahama Island resort property in North Myrtle Beach has fallen through, leaving investors who lost millions of dollars in deposits on the failed condominium project with dwindling alternatives to recoup their losses.")

Mortgage Servicing Companies Stiffing Maryland Governor On Call For Foreclosure Summit?

In Annapolis, Maryland, WBAL-TV Channel 11 reports:

• Gov. Martin O'Malley has called for an emergency work session with mortgage [servicing] companies to hammer out solutions to the foreclosure crisis. Letters have been sent to about a dozen loan [servicing] companies requesting they attend a summit on Feb. 28. But so far none of the loan companies have responded.

For more, see No Responses to Governor's Call For Foreclosure Summit (read story) (watch video).

Editor's Note:

In the WBAL-TV 11 video, Governor O'Malley refers to the "huge amount of losses" that the lending industry is facing. Someone in Maryland better explain to the governor that the mortgage servicing companies aren't facing any losses in foreclosure and have no incentive to meet with him. In fact, the servicing companies actually make more money when homes go into foreclosure with late fees and other default-related fees. The actual owners of the home mortgages, at least those of the subprime variety, are generally mortgage securitization trusts, interests in which are owned by private investors (ie. insurance companies, mutual funds, government and private pension funds, etc.) that are disbursed all over the world - and are only now beginning to wake up to the fact that their investments in the subprime mortgage trusts are tanking. While they may have an interest in mitigating their losses, the mortgage servicing companies who represent them (and who profit when there are more homes in foreclosure) don't.

Go here , go here , and go here for posts on questionable mortgage servicing practices. questionable mortgage servicing practices tactics xero

Nationwide Foreclosure Rescue Operator Charles Head Back In The News

Another story on national foreclosure rescue operator under Federal investigation, Charles Head, has come out; this time coming from Sacramento, California, where The Sacramento Bee reports on his local operations:

• [Head's] alleged scam includes at least seven Sacramento homeowners and 61 statewide, and the probe is based in the Sacramento FBI office, according to court documents, interviews and an Internal Revenue Service search warrant obtained by The Bee. An additional 100 investors who believed they were helping people on the brink of foreclosure also may have been swept up in the alleged scheme, with many having their credit ruined.

***

• [F]ederal authorities say the [investigation] has evolved into money laundering, and Head says the FBI has seized cash and exotic vehicles from him. "We're still reviewing the evidence we got from searches in Los Angeles," Sacramento FBI spokesman Steve Dupre said. "We're still attempting to identify more victims and put the pieces together."

The deals sound like the typical sale leaseback, equity stripping, "straw buyer" arrangements. Head's deals were reportedly described by one New Jersey attorney who has filed a civil lawsuit against Head:

1. Homeowners were told they could sign their house over to a trust and live there while repairing their credit,
2. They would pay monthly rent to Head's companies and, after a year or two, could buy back their home at about the same price,
3. Head recruited "straw buyers" to take title to the homes in the equity stripping transaction without any management responsibilities; they simply would lend their good credit to the deal in return for "straw buyer" fees of between $5,000 to $40,000.
4. The investors were told they didn't have to make mortgage or tax payments because Head's companies would pay the mortgages,
5. The investors found out the mortgages had not been paid when they started getting default notices in the mail.

For more, including some of the reported details involving a couple of the Sacramento-area homeowners who were allegedly victimized by Head's deals as well as the Federal asset seizures of property confiscated from Head, see Home scam suspected (Local FBI office heads 'foreclosure rescue' fraud probe).

Go here for other posts on the Head nationwide foreclosure rescue operation.

NY Governor Scorches The Bush Administration On Predatory Lending

In a recent article in The Washington Post, New York Governor Eliot Spitzer scorches the Bush Administration for its actions in impeding the state Attorneys General from all fifty states in their attempts to protect consumers from the actions of predatory lenders throughout the country. An excerpt from the article:

• Even though predatory lending was becoming a national problem, the Bush administration looked the other way and did nothing to protect American homeowners. In fact, the government chose instead to align itself with the banks that were victimizing consumers. Predatory lending was widely understood to present a looming national crisis. This threat was so clear that as New York attorney general, I joined with colleagues in the other 49 states in attempting to fill the void left by the federal government. Individually, and together, state attorneys general of both parties brought litigation or entered into settlements with many subprime lenders that were engaged in predatory lending practices. Several state legislatures, including New York's, enacted laws aimed at curbing such practices.

• What did the Bush administration do in response? Did it reverse course and decide to take action to halt this burgeoning scourge? As Americans are now painfully aware, with hundreds of thousands of homeowners facing foreclosure and our markets reeling, the answer is a resounding no. Not only did the Bush administration do nothing to protect consumers, it embarked on an aggressive and unprecedented campaign to prevent states from protecting their residents from the very problems to which the federal government was turning a blind eye.

For more, see Predatory Lenders' Partner in Crime (How the Bush Administration Stopped the States From Stepping In to Help Consumers).

Common Abusive Mortgage Servicing Practices

A recent article by Mortgage Professor Jack Guttentag appearing in Inman News Globe comments on some of the types of abuses mortgage servicing companies have been accused of engaging in. Among the alleged abuses referred to in the article include:

1. Pyramiding Late Fees: where the servicer continues to charge late fees until all prior late fees have been paid,
2. Pyramiding Resulting from Escrow Payment Shortage: When the scheduled payment is received on time but the escrow payment is short, the practice is to place the entire payment in a suspense account, to charge the borrower a late fee, and to send a delinquency notice to the credit bureaus,
3. Failure To Provide Monthly Statements: If the servicer does not send out monthly statements, the borrower will be in the dark. When a scheduled payment is placed in a suspense account due to an escrow shortage, the next month's regular mortgage payment will also be deposited into the suspense account, and the borrower incurs a second late charge and a second 30-day delinquency report. At this point, the account may go to collections, and the borrower will suddenly find himself dunned for a laundry list of fees, with failure to pay possibly resulting in foreclosure,
4. Mark-up of Price For Cost Of Services Provided By 3rd Party Vendors: Servicers squeeze extra profitability from their servicing operations by profiting from services provided by 3rd parties,
5. Failure To Report Good Payment Histories To Credit Bureaus: Some servicers cripple the ability of borrowers to refinance profitably by not reporting good payment records to the credit bureaus,
6. Unilateral Conversion Of Mortgage To Simple Interest: Some servicers purchase servicing contracts and unilaterally convert the mortgages to simple interest if the note does not explicitly prevent it without borrower approval,
7. "Abuse Cover-Up" By Selling The Servicing Contract: Some servicers cover up abusive practices by selling the servicing to another firm without forwarding evidence of the abuses -- the prior servicing record.

For the article, see Monthly statements would eliminate loan servicing fraud (if link expires, try here).

Go here , go here , and go here for posts on questionable mortgage servicing practices. questionable mortgage servicing practices tactics xero

Volunteer Lawyer Program For Qualified Ohio Homeowners In Foreclosure Slated To Begin In March

In Ohio, the Sandusky Register reports:

• Ohio Supreme Court Chief Justice Thomas Moyer, a Sandusky native, knows home foreclosures are a big problem back home in Erie County and across Ohio. Moyer is asking the courts and Ohio attorneys to reach out and help as many homeowners as they can. The chief justice has asked judges who handle foreclosure cases to use mediation to resolve as many cases as possible. And he's asked Ohio lawyers to volunteer in foreclosure cases to help families who can't otherwise afford a lawyer.

***

• Ken Brown, a spokesman for the Ohio Supreme Court, said the program to provide free volunteer lawyers for homeowners who otherwise can't afford them is supposed to begin in early to mid-March. Moyer issued a call for help several weeks ago and 200 to 250 lawyer answered, he said. A more specific letter from Moyer spelling out what the chief justice has in mind is being mailed out to every attorney in Ohio, Brown said.

For more, see Moyer to lawyers: Fight foreclosure for free.

Go here for posts on attorneys fighting foreclosures on a contingent fee basis (and racking up billable hours in the process - to be paid by the lender and/or mortgage servicer in a successful lawsuit) by invoking Federal and state consumer protection statutes.

For a post referencing a case that shows how it's possible for a law firm to be awarded not insignificant legal fees by a Federal judge in a "pro bono" case based on the number of billable hours invested in the case in connection with a lawsuit invoking a statute that mandates an attorney fee award to a successful plaintiff, see NY Lawyers Land Legal Fee Of $1 Million In Pro Bono Case.

Abandoned Real Estate May Be Costing Eight Ohio Cities $63M+, Says New Report

In Columbus, Ohio, The Associated Press reports:

• More than 25,000 vacant and abandoned properties cost eight Ohio cities at least $63 million, as ill-equipped local governments have been unable to wrestle with job loss and the foreclosure crisis, a report found. A report released Tuesday by Community Research Partners showed that Cleveland, Columbus, Dayton, Ironton, Lima, Springfield, Toledo and Zanesville have lost millions in services and tax revenues as vacant residences and abandoned lots have mounted. The study was commissioned by ReBuild Ohio, a coalition of local government, non-profit and civic organizations. Researchers said that Dayton and Columbus were able to provide complete data, but many of the smaller cities, as well as Cleveland, weren't able to provide a comprehensive picture. So the total costs of $63 million are likely to be much higher.

For more, see Report: Abandoned properties costing Ohio cities $63M.

See also, The Columbus Dispatch: Empty Housing Costing Millions (Vacant proprties degrade quality of life, study says).

To view the report, see $60 Million and Counting: The cost of vacant and abandoned properties to eight Ohio cities:

• Executive Summary,
• Full Report without city sections, (20.2 MB)
• Full Report (20.2 MB).

Foreclosure Crisis "An Opportunity To Find Low-Cost Housing With Some Privacy" For Many Street People, Says Homeless Advocate

The Associated Press reports:

• The nation's foreclosure crisis has led to a painful irony for homeless people: On any given night they are outnumbered in some cities by vacant houses, and some street people are taking advantage of the opportunity by becoming squatters.

***

• While no one keeps numbers of below-the-radar homeless finding shelter in properties left vacant by foreclosure, homeless advocates agree the locations — even with utilities cut off — would be inviting to some. There are risks for squatters, including fires from using candles and confrontations with drug dealers, prostitutes, copper thieves or police.

• "Many homeless people see the foreclosure crisis as an opportunity to find low-cost housing (FREE!) with some privacy," Brian Davis, director of the Northeast Ohio Coalition for the Homeless, said in the summary of the latest census of homeless sleeping outside in downtown Cleveland.

For more, see Foreclosed Homes Occupied by Homeless.

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