Monday, August 04, 2008

Minneapolis To Begin Abandoned Home Demolition Program; Costs Estimated At $17K Each

In Minneapolis, Minnesota, Minnesota Public Radio reports:
  • The city of Minneapolis is launching a new program aimed at clearing abandoned properties. The first of 100 blighted buildings will be demolished Monday in north Minneapolis. There are about 950 abandoned buildings in the city.

***

  • "These are the 100 worst in the city and the reason it's important to abate these nuisances and to get these properties torn down is that they profoundly affect the livability of our neighborhoods," Reimer said. Reimer said demolition costs an average of $17,000 each. Hennepin County is contributing more than a million dollars to help pay for the program.

For more, see Minneapolis begins effort to demolish abandoned house.

Go here, Go here, Go here, and Go here for other posts on vacant homes leaving their mark on neighborhoods. ForeclosuresDestroyNeighborhoodsApple

Milwaukee Mayor To Intervene In Home Foreclosure Over $50 Parking Ticket

In Milwaukee, Wisconsin, the Public Investigator Blog of the Milwaukee Journal Sentinel reports:

  • Mayor Tom Barrett said today he will work with the city treasurer's office to make sure Peter Tubic doesn't lose his home over a $50 parking violation. "While it is important to recognize the need to comply with rules and regulations, this is a highly unusual situation and I can't sit by and watch a man who is clearly suffering from mental debilitation lose his home because of a $50 ticket," Barrett said in a written statement.

***

  • Public Investigator wrote a story in Sunday's Journal Sentinel about a disabled Milwaukee man who ignored a parking fine for four years which lead to a foreclosure on his $245,000 house last week.

For more, see:

For story update, see Milwaukee man files petition to pay parking fine, keep house.

Go here for other posts on this story. MilwaukeeParkingTicket

Wave Of Mortgage Defaults On Prime Loans Quickly Building?

The New York Times reports:
  • The first wave of Americans to default on their home mortgages appears to be cresting, but a second, far larger one is quickly building. Homeowners with good credit are falling behind on their payments in growing numbers, even as the problems with mortgages made to people with weak, or subprime, credit are showing their first, tentative signs of leveling off after two years of spiraling defaults.

***

  • In a conference call with analysts last month, James Dimon, the chairman and chief executive of JPMorgan Chase, said he expected losses on prime loans at his bank to triple in the coming months and described the outlook for them as “terrible.”

For more, see Housing Lenders Fear Bigger Wave of Loan Defaults.

Two Closing Agents Indicted For Allegedly Pocketing $500K In Payoff Proceeds Due To Existing Lien Holders

In Boston, Massachusetts, The Patriot Ledger reports:

  • A Suffolk County grand jury indicted Walpole resident Bruce Namenson and his business associate Gerald Schena of Medford on larceny and embezzlement charges in connection with an alleged scheme to steal mortgage payments from loan companies.(1)

  • State prosecutors said Namenson and Schena acted as closing agents on three homes that were forced into foreclosure after they allegedly absconded with $500,000 that was supposed to pay off the properties’ mortgage debts.

For the story, see Two indicted in alleged scheme to cheat lenders.

See also:

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

(1) According to the story, (a) they were indicted last November on charges of insurance fraud, perjury and forgery in an unrelated case in Suffolk County; (b) the two were also indicted in Middlesex County in June on unrelated charges of insurance fraud; (c) Namenson, a lawyer who had a law firm in Quincy, was also indicted in late March for an alleged mortgage payment scam. sneaky slick escrow agents gamma

Milwaukee Man May Lose Home Over $50 Parking Ticket; Case Points To The Need For Court-Appointed Lawyers For Defendants In Civil Actions, Says Judge

In Milwaukee, Wisconsin, the Journal Sentinel reports:
  • Peter Tubic ignored a $50 parking fine in 2004, and on Monday, it cost him his $245,000 house. In what city officials believe is the first case of its kind, the city foreclosed on Tubic's house on W. Verona Court after repeated attempts to collect the fine - which over the years had escalated to $2,600 - had failed.(1)

***

  • Milwaukee County Circuit Judge Richard Sankovitz technically stayed the judgment to give Tubic one last chance to explain why he hasn't paid or even responded, but Sankovitz ruled in favor of the city's foreclosure. [...] Judge Sankovitz called the case a shame and said it demonstrates the need for judges to have authority to appoint attorneys for people involved in civil litigation. "If you were a criminal, we'd take care of the whole problem for you, get you an attorney," he said.

  • "But if you're involved in civil litigation - in jeopardy of losing your house or your family . . . what we do is make you go out and find your own attorney. "If we gave people the help they needed near the beginning of their problem, their problems wouldn't snowball the way they do."

For more, see Milwaukee man faces foreclosure because he didn’t pay parking fine (The ticket went unpaid for four years, eventually amounting to $2,600 in fines).

Go here for story update.

(1) According to the story, Tubic first got the fine for parking his Ford E150 with no license plates in the driveway of the home, which belonged to his parents at the time . The radiator had broken and Tubic couldn't get his plates renewed unless the van passed an emissions test. He didn't have the money to make the repair and had more pressing worries, he said. His father was suffering from dementia. His mother was battling cancer, and he was their live-in caretaker. He needed to shop, cook, clean, maintain the house and tend to his parents' needs. The van repair could wait, he thought. MilwaukeeParkingTicket

Ventura DA Issues Advisory On Fractional Interest Deed Transfers In Foreclosure Rescue Scams

In Ventura County, California, District Attorney Gregory D. Totten has issued an advisory warning county homeowners facing foreclosure to look out for and avoid fractional interest deed transfers(1) promoted by foreclosure rescue scam artists as a way to avoid foreclosure.

Among other things, the advisory warns that, while the County Clerk Recorder's Office may be legally required to accept properly prepared documents for recording, it doesn't necessarily mean that the act of recording a fractional deed is lawful. Among the potential unlawful acts that may be committed in connection with a fraudulent scam involving a fractional interest deed transfer in California (which can be found in the California Penal Code and the California Civil Code), according to the advisory, are:
  1. recording a false or forged document (Penal Code Sec. 115),
  2. foreclosure consultant fraud (Civil Code Sec. 2945.4),
  3. grand theft by false pretenses (Penal Code Sec. 487), and
  4. fraudulent conveyance of land with intent to delay creditors (Penal Code Sec. 531),

For more, including an explanation of the fraudulent deed transfer scam, see "Fractional" Deed Advisory (English version) (Spanish version).

Go here for a brochure on the Ventura County DA's Real Estate Fraud Prosecution Program (English) (Spanish); and go here for the DA's Real Estate Fraud Unit webpage.

Go here for other posts on fractional interest deed transfer, foreclosure rescue bankruptcy scams.

(1) Anyone wanting some perspective on how the "fractional interest" home title transfer scam works (fractional interest title transfers on the eve of foreclosure, use of backdated deeds for this purpose, abuse of the Federal bankruptcy court system, conveyances to unwitting debtors in bankruptcy in far away places, the frequency of use of this scam, and other interesting points), you can read this detailed narrative from a real live case decided by a Texas bankruptcy court.

Rhode Island Foreclosure House Stripping, Equity Stripping In The Same Story

In North Kingstown, Rhode Island, The Providence Journal reports the story of a subprime mortgage loan originator who lost his home in foreclosure. When the foreclosing lender took possession of the property, they found the home was stripped out of a variety of items typically found in and around a home.(1)

A possible contributing factor to the loan originator's financial problems: he was arrested(2) and charged in an alleged sale-buyback, foreclosure rescue scam:
  • At the time of DeBarros’ arrest, he was working as a mortgage originator when a Swansea homeowner called his company seeking help in refinancing her house to avoid foreclosure. Instead, DeBarros arranged for the house to be deeded to somebody else, according to court documents. A lawyer representing DeBarros argued that the homeowner received more than $13,000 and an option to buy back the property, so she “got exactly what she contracted for.”

  • DeBarros faces charges on two felony counts: larceny of over $250 by false pretense and solicitation to commit a felony. The judge scheduled the case for a jury trial on Sept. 18.

For more, see Where’s the kitchen!

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

(1) According to the story, sprinkler heads on the front lawn were snipped off; the heater for the in-ground swimming pool was missing; the shiny black countertops, wood cabinets, built-in double oven and decorative hanging lights were all gone; French doors had been torn from their hinges; a toilet and vanity in the downstairs bathroom were gone; air conditioner condensers had been ripped out; and the water, sewer and gas lines had been cut, leaving the pipes open and unsafe.

(2) According to the story, North Kingstown police had a warrant to arrest him on a “fugitive from justice” charge in connection with an alleged mortgage fraud scheme in Swansea, Mass. foreclosure fixture stripping apple

Memphis Legal Services Firm To Expand Free Aid To Homeowners Facing Foreclosure; Uses Lending Law Violations As Leverage In Seeking Loan Restructuring

In Memphis, Tennessee, the Memphis Daily News reports:
  • The budget of Memphis Area Legal Services has swelled to almost $650,000 this year as a result of grants and other special funding awarded to the group. And MALS, in turn, is using that windfall to expand its free counseling and legal aid to homeowners in danger of losing their homes to foreclosure.

***

  • The new funding MALS acquired to fight the rising tide of foreclosures in Shelby County was born out of a large settlement agreement put together over several months in the late summer and early fall of 2007. The agreement covered a series of companion lawsuits MALS brought against defendants including appraisers, brokers, closing agents and more.(1)

***

  • MALS’ staff pursues a variety of strategies to negotiate between debt-laden homeowners and their lenders. One of the first priorities is looking for any violation of lending laws. “If we do find a violation, that gives us some leverage to try to demand that lender restructure the mortgage,” [MALS' attorney Webb] Brewer said. “Basically, we look for leverage to get the meaningful restructuring (of a loan) that will allow someone to stay in their home.”

For more, see MALS Expands Homeowner Aid.

For other posts on homeowners using Federal & state consumer protection statutes to try and undo bad mortgage loans, Go Here, Go Here, and Go Here.

For posts that reference the failure of some mortgage lenders and their attorneys to file the required loan documents and otherwise fail to establish that they have legal standing to bring foreclosure actions, Go Here, Go Here, Go Here, and Go Here.

(1) According to the story: The plaintiffs were homeowners trapped in mortgages they couldn’t afford; MALS' attorney Webb Brewer said the settlement on behalf of 17 plaintiffs in the various cases was cumulatively worth $3 million; some of the settlement was actual cash for the victims - the rest of the value comes from the savings in restructured mortgages that MALS helped negotiate. undo mortgage loans TILA batallion

Sunday, August 03, 2008

More On The Connection Between Loan Workouts & Buyers Of Discounted Mortgages

Five recent media reports have addressed the move of investors towards purchasing discounted mortgages with the view of seeking a loan restructuring with a financially strapped homeowner.

A story by The Associated Press reports:
  • Guess who holds your mortgage now? It's your friendly neighborhood hedge fund. Dozens of hedge funds, private equity groups and other investors have plunged into the beaten-down mortgage market in recent months, buying tens of thousands of distressed loans and foreclosed properties around the country.

***

  • "We're much easier to deal with than a bank," said Jacob Benaroya, managing partner of New Jersey-based Biltmore Capital Group, a hedge fund that's buying up to $100 million in mortgage debt per year. "We've bought (the loan) at enough of a discount that we can make special arrangements with the borrower."

For more, see Hedge funds investing in delinquent mortgages (Many claim that they can alter terms of loans much easier than banks) (If link expires, try here).

The New York Times reports:

  • [U]nder [a] new initiative, called the Housing Assistance and Recovery Program, or HARP, the [Federal] Home Loan Bank [of New York] lent $6 million to Magyar Bank, based in New Brunswick, N.J. The First Baptist Church of Lincoln Gardens, in Somerset, N.J., which provides counseling services through its First Baptist Community Development Corporation, identifies homeowners who are in danger of foreclosure, then negotiates with the lender to buy out the loan.

  • Using proceeds from the Federal Home Loan Bank, Magyar Bank puts up 70 percent of the remaining balance. HARP representatives expect that lenders who hold the distressed mortgages will write off much of the remaining 30 percent, rather than incur a foreclosure.

For more, see Struggling, but Staying in a Home.

For three other stories, see:

  • Bloomberg News: Discounted Mortgage Notes Can Stop Foreclosures (Buying defaulted mortgages at a discount, the mortgage investor encourages and enables owners to stay in their properties and avoid foreclosure. His company buys the loans, not the homes, then employs a "work- out, not kick-out'' approach in working with homeowners),

  • Bloomberg News: Recovery From Worst Housing Slump Since 1930s Comes With Angel (Reportedly, one individual investor buys bad mortgages a dozen at a time for a fraction of their face value from lenders. He then goes door to door to negotiate lower payments for homeowners or pay them to move so he can sell the house).

New Yorks State Couple Lose $600K Home Over Unpaid $45K Tax Bill; County Refuses To Accept Late Payment

In Webb, New York, The Utica Observer Dispatch reports:
  • A family in this Adirondack town could be losing its home, business and waterfront camp on Fourth Lake over back taxes, even as the family says it now can make its payments. Total value of the property: $600,000. Herkimer County legislators recently have taken an interest in the case, raising questions about whether helping this one family would amount to favoritism over the dozens of other people each year who are at risk of losing their property over failure to pay taxes. Despite Terry and Deborah Jones’ willingness to pay the tax money, judges have ruled county officials aren’t doing anything wrong by taking the property. The Joneses are appealing the latest ruling.

For more, see Adirondack couple fights to retain its property; Herkimer Co. legislature debates tax approach.

Three Charged For Allegedly Using Stolen Identity In Fraudulent Home Purchase

From the San Bernardino County, California District Attorney's Office:
  • [I]nvestigators from the San Bernardino County District Attorney’s Real Estate Fraud Unit arrested "Carlos" Gabriel Hernandez, 36, of Adelanto and Jose Oliva, 32, of Fontana on felony charges connected to real estate fraud. Additionally, [...] Luis Robles, 46, of San Bernardino was arrested at his residence [... . A]ll three suspects were arrested for several felony counts including grand theft and forgery.

  • In 2003/2004, the three conspired to steal the victim's identity for the fraudulent purchase of a home in Victorville. The victim discovered the fraud when he attempted to refinance his own Santa Ana residence. The victim found that his signature had been forged on numerous loan documents.

For more, see Real Estate Agents Arrested in Real Estate Fraud Conspiracy.

Massachusetts "Right-To-Cure" Law Credited For Reduction In "Foreclosure Starts"

In Massachusetts, The Boston Globe reports:
  • The number of foreclosure proceedings initiated in Massachusetts plummeted in June, a sign that a new state law delaying property takings is working. [...] The drop is attributed to a state law that took effect May 1 giving struggling homeowners a bit of breathing room. The so-called right-to-cure law created a 90-day period in which homeowners can "cure" mortgage delinquencies by catching up on payments or finding a buyer. Signed by the governor in the fall, the law also prevents lenders from tacking on fees during those 90 days, said David Cotney, chief operating officer for the state Division of Banks. Normal mortgage payments will continue to accrue, however. [...] Even with the cooling off period, Massachusetts is on track to have more than double the number of foreclosures this year than in 2007.

For more, see Mass. foreclosure cases plummet (New law is credited, but will the relief be just temporary?).

Saturday, August 02, 2008

Minneapolis' Number Of Abandoned, Condemned Properties On The Upswing

In Minneapolis, Minnesota, the Twin Cities Daily Planet reports:
  • When the city of Minneapolis first began tracking and boarding up the growing number of vacant homes in 2004, abandoned properties in the city totaled around 250. That included homes that were vacant and/or condemned for all years prior, some going back to early 2000. Now, in just the first six months of this year, Minneapolis has added another 250 homes to its record list of vacant and condemned properties. Since 2004, the original list has grown to nearly 950 vacant properties, an increase of 260 percent.

***

  • The chances of the these homes being purchased and renovated grow slimmer every day. Of the 950 or so abandoned properties on the list, more than 60 percent of them have been deemed “condemned” by the city.

For more, see Alone home: Minneapolis adds 250 houses to its vacant properties list in only six months.

Go here for city’s vacant house report.

Go here, go here, and go here for other posts on vacant homes leaving their mark on neighborhoods. neighborhood destruction from foreclosures kappa

"The Today Show" On Foreclosure Pets

NBC's Today Show reported a story last week on foreclosure pets, those animals that lose their homes as a result of the foreclosure problems of their owners. A few highlights:

  • And in Evansville, Ind., the Vanderburgh County Humane Society has literally run out of room. “Unfortunately, when we run out of cages, a lot of times we don’t have any other option but to euthanize, so it’s just a really hard time for us,” said Miranda Russell, spokeswoman for the agency.

  • The story is the same at the Metro Animal Control shelter in Nashville, Tenn., which is so overcrowded that it is euthanizing 30 to 50 animals every day, six days a week. “It’s something we were expecting — above capacity because of foreclosures,” Animal Control Officer Billy Briggs said.

For more, see Foreclosures close the door on family pets (Shelters are seeing more strays as families abandon homes, cut costs).

For other posts on foreclosure pets, go here, go here, and go here. ForeclosurePetsAlpha

Vacant Homes, Indoor Pot Farms Keep Southwest Florida Cops Busy

In Lee County, Florida, The News Press reports:

  • Vacant houses and houses filled with growing marijuana plants keep deputies busy, the captain of the Lee County Sheriff's Office district in Lehigh Acres told the chamber of commerce Tuesday. The crime rate would be a lot lower without the vacant houses, Capt. Ed Tamayo told about 80 people at the chamber's monthly luncheon while talking about residential burglaries.

***

  • Lee County's code enforcement division has identified 400 cases of abandoned homes under construction. Construction sites are considered abandoned if they haven't had an inspection in six months. Deputies also have been busy with [marijuana] grow houses in Lehigh. The district closed nine houses in June. "Lately, it's become an almost daily event," Tamayo said.

  • The News Star began tracking grow house raids in Lehigh Acres on Oct. 1, 2007. Law enforcement officers have shut down at least 52 operations through July, made more than 80 arrests and confiscated nearly 3,200 plants.

For more, see Vacant homes fill deputies' schedules (Captain tells chamber about area crime rates).

Go here for a KNBC-TV story on a busted Corona, California marijuana grow house operation, including a tour of the inside of the home (video only). pot grow ops beta

Shutting Off The Electricity In Foreclosed Home A Great Way To Create A Mold, Mildew Problem

In Spotsylvania County, Virginia, The Free Lance Star did a story on the foreclosure aftermath homes suffer once they are vacated and abandoned by the former homeowners. Buried in the story is this excerpt, which points to the apparent willingness of some lenders (or their loan servicers) to actually make the situation worse than it already is with foreclosed homes:
  • [Home inspector Joel Webber] said in the past, the biggest problem in foreclosure homes was holes in the wall and other signs of homeowners angry about losing the house. But he said that's not the case these days.

  • Rather the most common problem, he said, is mildew. Between 25 percent and 50 percent of the foreclosure homes he inspects have mildew, and another 10 percent have mold. In many of those cases, the banks turned off the electricity after reacquiring the houses.

  • Rain floods the basement, and the sump pump isn't able to remove the water. There's no air conditioning. Houses are sometimes on the market for months in this condition. That's all a recipe for mold and mildew. Webber questioned why the banks wouldn't take better care of the homes if they're trying to sell them.

For the story, see Vacated homes are foreclosed (Foreclosures often left in bad condition). neighborhood destruction from foreclosures kappa

Salt Lake Health Dept. Not Liable For Incorrectly Declaring Ex-Meth House Safe; Homeowners Vacate, Leaving Lender Holding The Bag

In Salt Lake County, Utah, KSL-TV Channel 5 reports:
  • A Salt Lake County family is devastated after a judge ruled they can't sue the health department for negligence. The family unknowingly purchased a home that was once a meth lab, but the Salt Lake Valley Health Department (SLVHD) later told them inspectors had declared it was safe to live in. Our investigative team tested the home last year and discovered it was still contaminated with meth.

  • [Friday], a district court judge dismissed the [family's] lawsuit against the SLVHD, because there's a Utah law in place that protects the agency from liability. It's called Governmental Immunity -- basically the [family] can accuse the health department of negligence, they just can't sue them over it.

***

  • After a neighbor informed the family they'd purchased a former meth lab, the health department assured them it had been decontaminated, it was even in writing. Then, last spring, we came along and tested the home and found meth contamination all over the place. [...] Here are the facts for the [family]: They can't afford the $40,000 it'll cost to decontaminate the meth home, and it'll go into foreclosure.
For more, see Court: Family can't sue health department over meth house.

In a related KSL-TV Channel 5 report, see: Former Meth Houses Declared "Safe" May Not Be:

  • Hundreds of Utah homes, former meth labs, have been shut down until they're rid of the dangerous drug. But an Eyewitness News Investigation uncovers disturbing evidence: Homes the government reopened and declared safe, may not be. [...] We discovered there are now more than 250 homes in the Salt Lake area that were once meth labs. Do the people living there now know that? Or did sellers keep it a secret? We went knocking on some doors.

Go here and Go here for other posts on home-based methamphetamine labs.

Editor's Note:

The day mortgage lenders begin requiring mold and methamphetamine inspections(1) from homebuyers seeking a home loan may soon be approaching (and could become as common as getting a termite inspection).

The day may also be coming when laws are changed to require law enforcement, health department officials, etc. to record a notice in the public record (the same way one records a lien against real estate) that a home, apartment, etc. was the cite of a methamphetamine or marijuana grow house bust and may require remediation. Such a notice, when discovered in the course of a title search, would warn both the homebuyer and lender of a "secret charge" (the cost of remediation) against the real estate that someone will ultimately have to "satify."

(1) At least in those homes that have a recent foreclosure listed in its chain of title. meth lab yak

Neighbors Find 15+ Cats Inside Trash-Filled Vacant Home In Foreclosure; Legal Technicalities Leave City, Animal Shelters With Hands Tied

In Newark, Ohio, The Newark Advocate reports:
  • When Nick Siney’s neighbors moved out several weeks ago, he was surprised to see cats peeking out of the windows. The neighbors no longer were living in the house, and Siney said they didn’t seem to be coming back each day to care for the animals.But it wasn’t until another neighbor broke a window and kicked in the back door of the house on the 200 block of Mound Street that neighbors realized more than 15 cats had been trapped inside the house. [...] None of the neighbors expected the property owners to return. Licking County court records indicate foreclosure papers were filed against the house earlier this year.

For more, see Abandoned cats raise neighbors' concern.

For other posts on foreclosure pets, go here, go here, and go here. ForeclosurePetsAlpha

Foreclosures Wiping Out One Entire Rental Neighborhood

In Visalia, California, The Fresno Bee reports:

  • An entire neighborhood is vanishing by way of a little-known effect of the foreclosure crisis: owners of small apartment houses defaulting on their payments. Myrtle Court, a cul de sac near Demaree Road and Highway 198, is losing its residents as lenders foreclose on a string of attractive fourplexes built in the late 1990s and evict those living inside. Lenders have repossessed or in the process of taking back at least eight of the 12 apartment houses that occupy the block-long street, all from the same owner.

***

  • Increasingly, residents of duplexes, triplexes and fourplexes are being evicted because lenders that foreclose treat the buildings as residential property, not commercial, said Robin Kane, a Fresno real-estate consultant who is studying foreclosure trends in multifamily housing. Smaller apartment buildings can be purchased with the same kind of financing used to buy single-family houses, Kane said.

  • A [California] state law passed in July requires lenders to give tenants 60 days' notice unless they agree to a cash-for-keys settlement, said Mona Tawatao, an attorney with Northern California Legal Services. Residents also should get their security deposits returned, she said.

For more, see Another door to foreclosure (Evictions at small Visalia apartment complexes are just one example of how rentals are vulnerable to the mortgage crisis).

Private Lender Apologizes For Panicking Property Owners With Erroneous Delinquent Tax Foreclosure Letter

In Witchita Falls, Texas, the Times Record News reports:
  • A Wichita Falls mortgage company said a clerical error caused 20 letters to be sent to Montague County property owners indicating their homes would soon be sold on the courthouse steps for back taxes. It also offered to make tax lien loans so recipients could get up to date on taxes and avoid interest and penalties.

***

  • [Montague County Tax Assessor-Collector Syd] Nowell started to get calls from panicked property owners last week. Compared to the tax records, the letter appeared to contain falsehoods about the tax auction and that the names of properties slated for foreclosure were “issued by the law firm that represents the local tax authorities.”

According to the story, the company owner explained that “A direct mail merge caused the wrong letter to be mailed to the wrong people.”

For more, see Mortgage company issues apology (Clerical error cited for tax lien letters).

Cops Use Vacant Foreclosure In Online Prostitution "Sting"; Investigators Rope In Suspects By Answering Craigslist Ads

In Tracy, California, KXTV Channel 10 reports:
  • The U.S. foreclosure crisis is helping police in Tracy when it comes to catching alleged prostitutes. This week, authorities conducted an online sting, targeting 'casual encounter' ads on the popular Web site Craigslist. Using a vacant foreclosed house as the meeting point, undercover police offered numerous women money in exchange for sex and many agreed, arriving at the house one by one throughout the night.

***

  • [Tracy Police spokesman Matt] Robinson said Tracy Police planned to conduct more online stings in the future.

For more, see Foreclosures Help Police Nab Alleged Prostitutes.

Foreclosed Owner Walks Away Leaving Behind $800K In Marijuana, Pot Farm Equipment, Moldy Home

In Bloomington, Minnesota, KAAL-TV Channel 6 reports:
  • An inspector, changing the locks on a foreclosed home, discovered a major drug operation in Bloomington Thursday. Police in full HAZMAT gear spent the day hauling lights and other equipment used to grow marijuana from the home near 98th Street and France Avenue.

***

  • Police said they seized 200 marijuana plants worth up to $800,000 on the street. Investigators also found a big mess inside. "There is a lot of dirt and mold growing up the sides of the walls," said Bloomington Police Commander Jim Ryan.

For more, see Pot bust in foreclosed Bloomington home.

Go here for a KNBC-TV story on a busted Corona, California marijuana grow house operation, including a tour of the inside of the home (video only).

Editor's Note:

It could be that the marijuana crop left behind by the pot farmer may have been contaminated by the presence of mold, possibly making the stash worthless.

Go here and go here for other posts on Marijuana Grow Houses. pot grow ops beta

Carrying Out Foreclosure Evictions "Like A Sick Sort Of Game Show" For Deputies?

In Clark County, Nevada, the Las Vegas Sun reports:
  • It’s like a sick sort of game show: What’s behind Door No. 1? Abandoned furniture? A man with a gun? A rabid bichon? A housewife wielding a frying pan?

  • Because they’re the bearers of get-out-in-three-days eviction notices, constables in Clark County are some of the most vocal critics of the foreclosure process as it applies to renters. This is because they’re the bearers of bad news. And although nobody likes delivering disappointment, that’s not really the issue.

  • The problem is that blindsiding people is dangerous. Bob Wyant, a Las Vegas deputy constable, has seen bullets fly through front doors. He’s had to fight people who start problems. One guy saw Wyant, walked upstairs and shot himself in the head. A woman locked herself in her bedroom with a blazing barbecue grill, trying to give herself, and her cats, carbon monoxide poisoning.

For more, see Constables deliver bad news at their peril.

Go here for other posts on Police involvement in foreclosures. SheriffDeputiesForeclosureAlpha TenantRentSkimmingAlpha

SW Florida Man, Upset About Facing County Foreclosure, Threatens To Bomb Government Center, Code Enforcement Offices Say Cops

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

  • A 61-year-old man upset about facing foreclosure was arrested Monday after he made threatening comments to a Collier County government official, according to Collier County Sheriff's Office reports.

***

  • Arrest reports say [property owner Jean Claude] Martel showed up at the Collier County manager’s office at the Collier County Government Center [... in] East Naples, around 12:30 p.m. on July 25 and refused to leave until he spoke with the county manger. Deputy County Manager Leo Ochs spoke to Martel, who was upset because the county was foreclosing on his property, arrest reports said.

  • During their conversation Martel threatened several times to blow up buildings at the county government center and at the county code enforcement offices [...] in East Naples, arrest reports said. He also threatened to shoot county employees if they attempted to enter his property and to burn any buildings that might be built on “his land,” arrest reports said.

For the story, see Man arrested for alleged threats at Collier County manager's office in foreclosure case.

Foreclosure Fish Popular With South Florida Mosquito Control Departments

In Miami, Florida, WFOR-TV Channel 4 reports:
  • [M]osquito-control departments across Florida, especially in South Florida, are hearing rising complaints about pools turning into soupy messes at homes in foreclosure but Miami-Dade's mosquito control department is fighting back with fish. [...] There are many methods being used to control the problem, including chemical treatments, but one of the most unique methods is mosquito-eating fish. They're called "Gambusia Affinis", also known as mosquito fish.

***

  • But is it cost effective? Absolutely. The fish is native in South Florida and can be found in just about any canal.

For more, see Foreclosure Fish Take Bite Out Of Mosquito Problem (They're Being Used In Pools Of Foreclosed & Abandoned Homes).

Foreclosure Blight Found Attractive By Some

While foreclosure blight, manifested by vacant & abandoned homes, broken or boarded up windows, weeds, refuse left by those using the empty houses as garbage dumps, rain-sopped newspapers in the driveway, and "green" pools may be considered repugnant by most, there are some groups who find such conditions quite appealing, as evidenced by these stories:
  • Casselberry, Florida - Central Florida Neighborhood Getting Ratted Out: Some people living in the Carriage Hills Estates in Casselberry say the increasing number of abandoned houses is causing a rat infestation. [...] “It’s gross when I’ve got holes in my house,” said resident Dave Fulton. “They're coming through the roof. Through the walls of my house.”

  • Spring Hill, Florida - Foreclosure's Rancid Odor: Foreclosures stink. Not just for the homeowner but, as Doug Ellison will tell you, the neighbors left behind. In Ellison's situation, the house next door [...] has been sitting vacant since mid June. [...] He's trapping rats in his backyard now. And as the day warms up, maggots squirm on the putrid bags of refuse.

  • Vallejo, California - One Vallejo Neighborhood Hard Hit by Foreclosure Crisis: The blight is not attracting very many prospective buyers, but it is attracting vermin, which is something [homeowner Dave] Abbitt has witnessed first hand. "I’ve seen a lot more rat droppings. Just the other day I had a big rat in the yard that my dog might have killed,” said Abbitt.

  • Manassas, Virginia - Shuttered Homes, Thriving Wildlife: Among the opportunistic wildlife attracted by foreclosure blight, according to this story, are rats, snakes, mosquitos, ticks, and other members of the animal kingdom.

  • Merced, California - City works to tackle foreclosure eyesores: Stagnant water in swimming pools becomes a breeding ground for mosquitoes. Worst of all, dark houses with no signs of life houses attract vandals, drug dealers, and other criminals ... .

  • Tucson, Arizona - Bees Buzz Tucson Neighborhood: In one local Tucson neighborhood when the humans moved out, the bees moved in. These pests have become well established and are creating serious problems for the neighborhood. [...] The bees are now terrorizing the entire area.

  • Bradenton, Florida - Owners of bee-infested house face pressure to remove them: For more than a month, people in the neighborhood have been worried about the growing number of bees that have moved into one house. They say the number of bees is growing everyday. The house is empty and going through foreclosure, and is owned by the Bank of New York.

Go here, go here, and go here for other posts on vacant homes leaving their mark on neighborhoods. neighborhood destruction from foreclosures kappa

Friday, August 01, 2008

NCRC: Minorities At Highest Risk Of Getting Stiffed With High Cost Home Loan

In Washington, D.C., a news release issued by the National Community Reinvestment Coalition announces:

  • A new report by the National Community Reinvestment Coalition (NCRC) shows that minority consumers, regardless of income level, are most at risk of receiving high-cost home mortgage loans. High-cost loans represent the riskiest and most poorly underwritten home mortgages, millions of which have fallen into foreclosure in the last two years. The study, Income Is No Shield Against Racial Differences in Lending II, examined subprime and near prime (“Alt-A”) loans from more than 219 metropolitan areas, as reported under the Home Mortgage Disclosure Act data from 2006, the most recent publicly available data.

For more, see:

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

Elvis Impersonator On The Run; Vegas I-Team Finds Records Linking Suspected Foreclosure Rent Scammer To Unwitting Tenants In 42 Homes In Foreclosure

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

  • For weeks, the I-Team has been following the case of a local Elvis impersonator renting out foreclosed homes to unsuspecting tenants. He didn't tell them his company took possession of the homes without the owners or banks' knowledge. Now Elvis Nargi isn't saying anything -- because it appears he has left town.

***

  • But Nargi didn't cover his tracks -- and he left behind some pretty damaging clues. First, there's the pounds of shredded documents, including property tax receipts for multiple homes and old loan agreements. The I-Team obtained copies of rent statements for the properties Elvis didn't have a right to.

  • Nargi also had a master list of properties. It includes the address, the renter and how much they pay a month and owe him through July. The I-Team identified 42 of the properties on the list. Every single one of them was going through the foreclosure process. Nargi's company records show the victimized tenants would have paid him more than $60,000 in a single month. [...] At long last... Elvis has left the building.

For more, see I-Team: Elvis Impersonator Has Left the Building (read story) (watch video).

For earlier KLAS TV Channel 8 reports on this story, see:

Go here and go here for other posts on tenant victims of rent hoaxes. unwitting tenant rent scam yacht

Northern Virginia Renter Under Unrecorded Contract For Deed Arrangement May Lose Home As Landlord Stiffs Bank While Pocketing Monthly Payments

In South Riding, Virginia, WRC-TV Channel 4 reports:
  • The foreclosure crisis is trickling down to renters and people leasing homes with the hope of purchasing them some day. In late 2005, William Craig signed a contract offering a lease with an opportunity to own a South Riding dream home, he said. Instead, he lost the home and all the money he invested in it. On July 25, Craig's landlord e-mailed him to let him know the home was in foreclosure. An attorney sent Craig the newspaper clipping of the public auction notice. [...] The auction is slated for Friday, but the landlord and his real estate agent told News4 that they're negotiating with the bank so that Craig can take over the mortgage payments and own the home.

For the story, see Foreclosure Ends Loudoun County Man's Lease-To-Own Contract.

Go here for the more extensive video report.

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

Tacoma Couple Enforce Truth In Lending Rights Against Foreclosing Lender As State Regulators Crack Down On Improper Loan Practices

In Tacoma, Washington, the Seattle Post Intelligencer reports:
  • Michelle Miran didn't realize that there was something wrong with her mortgage until the interest rate reset last year. Her truth-in-lending statement – the legally required disclosure of loan rates and estimated costs – noted a 30-year fixed rate with monthly payments of $1,311 for 359 months. But two years into it, her monthly payment shot up to about $1,700, and she and her husband fell behind. They're now fighting foreclosure on their Tacoma home and fighting back in court, suing the mortgage broker and lender.(1)

  • Their battle comes as state regulators have cracked down on mortgage abuse, bringing charges against lenders and brokers for charging unlawful or excessive fees, failing to disclose costs and fees to borrowers and imposing illegal prepayment penalties.

For more, see State, homeowners taking on lenders (Questionable mortgages appear headed for court).

For other posts on homeowners using Federal & state consumer protection statutes to try and undo bad mortgage loans, Go Here, Go Here, and Go Here.

(1) According to the story, (1) The Mirans claim that the truth-in-lending statement they received represented the loan as a conventional 30-year, fixed-rate loan; (2) their lawsuit alleges that the monthly payments shouldn't have gone up after two years; (3) their HUD-1 settlement, a document borrowers get at closing that itemizes all charges, did not credit the couple for a $6,000 payment to mortgage broker America One, according to their lawsuit; (4) Miran said the loan officer rushed her through the closing process, sending her a 2-inch- thick stack of documents while she was out of town on business; (5) Miran claims to have signed the documents alone in her hotel room, and not in the presence of an escrow agent, even though an agent's signature appears on the documents, according to the lawsuit; (6) She also claims to have paid loan-origination fees that didn't reduce the rate she was charged; (7) Washington State regulators issued a cease and desist order against the loan officer, Eliza Bautista, in 2006, about a year after the Mirans took out their loan. undo mortgage loans TILA batallion

Minnesota Homebuilders Sentenced In Straw Buyer Scam / Bogus Rent To Own Deals; May Be Biggest Fraud In State History

In Minneapolis, Minnesota, the Pioneer Press reports:
  • They were high school sweethearts who grew up to be two of the most well-regarded homebuilders in the metro area, then watched their company crumble amid their own fraud and illegal borrowing.

  • Michael and Ardith Parish, the architects of what is presumed to be the largest case of mortgage fraud in Minnesota history, were sentenced Thursday in U.S. District Court in Minneapolis. Michael Parish, 63, received 13 years in federal prison or a work camp; his wife, Ardith, 62, received five years.

  • Their son-in-law, Christopher Troup, 40, was sentenced to 10 years for playing a lead role in the massive housing scheme, which the courts believe involved 240 homes now in various stages of foreclosure. Investigators believe $100 million in lending changed hands, causing $20 million to $50 million in losses.

For more, see Eagan couple, son-in-law sentenced in state's largest mortgage fraud.

See also, Minneapolis Star Tribune: Principal in Parish fraud gets 13-year prison term (The judge rejected pleas for leniency in the case of mortgage fraud and money laundering. Co-defendants got five and 10 years).

Go here for earlier posts on Eagan, Minnesota homebuilder Parish Marketing and Development.

Bank Screw-Up, Falling Home Values, Tighter Lending Standards Leave Refi-Seeking New Jersey Couple Up The Creek

In Neptune City, New Jersey, the Asbury Park Press reports on the nightmare of homeowners Mark and Jennifer Seymour, a couple who, because of a screw up by their original lender, is now stuck with a problem:
  • [M]ark Seymour manages a pool and spa company, earning about $52,000 a year. Jennifer works as a bus driver, making about $16,000 a year.

  • They made enough to purchase their first home -- a three-bedroom ranch with white siding and green shutters -- in February 2006 with no money down for $200,000. They obtained a loan through National City Bancorp with a fixed interest rate of 6.75 percent, leaving them a payment of about $2,200 a month, including taxes.

  • About six months later, they said, National City notified them that it had made a mistake. It forgot to include private mortgage insurance, normally required for buyers who don't put at least 20 percent down. It boosted their payments by $786 a month.

For the rest of Seymour's nightmare, see Handcuffed (Homeowners looking for flexibility from their lenders are running into barriers because of falling property values and tighter lending standards) (if link expires, try here).

Philly Foreclosure Mitigation Plan - So Far, So Good

In Philadelphia, Pennsylvania, Philadelphia Metro reports:
  • While the federal government is slowly addressing the nation’s mortgage foreclosure crisis, local officials are calling the city’s innovative program an early success. Last month, officials held the first round of conferences at City Hall for homeowners whose properties were listed for sheriff’s sale in April and May, but were stayed due to a moratorium. Of the 1,600 total homes affected, 667 were owner-occupied and eligible for conferences and 322 homeowners attended the conferences.

***

  • The next round of conferences is set for Aug. 12-15 for homeowners whose properties were listed for sheriff’s sale in June. After Labor Day, however, the program will start to target residents before their properties reach the stage of sheriff’s sale — which officials say should significantly increase the participation rate.

  • Yes, the number of foreclosures is still huge compared to the amount of help that is available,” said Beth Goodell, managing attorney at Community Legal Services [of Philadelphia], adding “I remain optimistic that this can help a significant number of people.” Homeowners [in Philadelphia] that are behind on their mortgage payments or facing foreclosure can call 215-334-HOME to set up a free session with a housing counselor.

For more, see Philly mortgage crisis program getting thumbs up.

Go here for more on Philadelphia's Residential Mortgage Foreclosure Diversion Pilot Program.

Freddie To Double Cash Incentives To Servicers Working With Delinquent Borrowers

Reuters reports:
  • [F]reddie Mac, a government-chartered company, will [...] increase the time it gives servicers to negotiate with delinquent borrowers in Washington, D.C., and 20 states to 300 days from a range of 120 to 299 days, a spokeswoman said. The states are those with relatively fast foreclosure processes, Freddie Mac said.

***

  • Compensation to servicers that negotiate new payment plans and loan contracts will double to $500 and $800, respectively, Freddie Mac said. For a servicer that completes a so-called short-sale, in which Freddie Mac accepts a sale price on a home below the balance of the mortgage, payments also double, to $2,200. Accepting short sales can result in lower losses for lenders by ending the delinquency period and preventing ownership of the property through foreclosure.

  • Among new incentives, Freddie Mac said it will reimburse servicers for the cost of door-to-door programs -- in which servicers seek out troubled borrowers in person to discuss renegotiating their loans -- if they result in the borrower contacting the servicer.

For more, see Freddie Mac boosts mortgage servicer incentives.

2nd Florida County To Move Foreclosure Sales Online

In Central Florida, according to an online press release issued through MarketWatch:
  • [The] Manatee County Clerk of the Circuit Court and Comptroller has selected RealForeclose by Realauction to begin sales of foreclosed property online. [Clerk of the Circuit Court and Comptroller R.B. "Chips"] Shore has been proactive in reducing the paperwork involved and increasing the number of bidders participating as the leading reasons to embrace technology for foreclosure sales.

For more, see Manatee County Clerk Begins Online Foreclosure Sales with Realauction.

For the other Florida County moving their foreclosure sales online, see Duval County First to Begin Online Foreclosure Sales with Realauction.

Florida Attorney Pro Bono Foreclosure Defense Group Encounters Potential Legal Roadblock

In Florida, The Associated Press reports:
  • If you need help strengthening your home against hurricanes or other disasters, just call FLASH. If you're a Florida homeowner and need free legal aid to avoid foreclosure, you can call another FLASH. The first FLASH - the Federal Alliance for Safe Homes - on Thursday demanded that the second FLASH - Florida Attorneys Saving Homes - stop using its acronym. Both are nonprofits based in Tallahassee.

  • The attorneys group is checking with lawyers who have trade mark expertise before responding, said Kent Spuhler, executive director of Florida Legal Services. The safe homes FLASH says it's been getting calls about legal help since the attorneys' FLASH was featured Wednesday on CNN's Larry King Live.

Source: Legal, home safety groups clash over FLASH.

Bank Of America Called Upon To Voluntarily Halt Countrywide Foreclosures In San Diego

In San Diego, California, KGTV Channel 10 reports:

  • The City Attorney's Office last week filed suit against the bank, which bought Countrywide earlier this year as the mortgage crisis spun out of control. Aguirre alleged that Countrywide engaged in predatory lending practices in San Diego. Aguirre sent a letter to the bank's Los Angeles attorneys – Paul McNamara and Brooks Brown -- asking for the foreclosure moratorium as "an act of goodwill," and not an admission of wrongdoing.

For more, see City Attorney Asks BofA To Stop Foreclosures.

Editor's Note:

City Attorney Aguirre has set up a hotline for all San Diego residents who are stuck with a Countrywide subprime mortgage. San Diegans facing foreclosure by Countrywide can call 619-533-5679 or go to the city attorney's Web site and click on the "Foreclosure Crisis" link. See Hotline Offered For Homeowners Facing Foreclosure With Countrywide.

Thursday, July 31, 2008

Countrywide Caves In To Picketers, Public Outcry In Battle To Take Home From 72-Year Old Disabled Woman

In Detroit, Michigan, The Michigan Citizen reports:
  • On Friday, July 25, a settlement between [72-year old Rubie Curl] Pinkins and Countrywide Home Loans, which is owned by the Bank of America, was reached in front of Wayne County Circuit Court Judge Susan Borman. The settlement maintains Pinkins in her home in exchange for payment from a reverse mortgage of the money she owed Countrywide at the time of redemption.

  • Curl said community and church members, along with State Sen. Hansen Clarke and even Gov. Jennifer Granholm responded positively to her family’s call for support.

  • On July 18, hundreds of community supporters rallied in front of the Pinkins home on Holden. On July 22, dozens demonstrated outside of the downtown Detroit Bank of America headquarters. [Attorney Vanessa] Fluker said she and Curl went inside to confront the vice-president there despite police attempts to remove the picketers, including Mrs. Pinkins in her wheelchair.

For more, see Pinkins foreclosure victory.

See also:

Go here for other posts on Rubie Curl Pinkins versus Countrywide. countrywide consumer problems

Mass AG Makes Mortgage Mod Deal With Owner Of 200 "Fremont" Loans Subject To Foreclosure Injunction & Lawsuit Alleging Unfair/Deceptive Practices

From the office of the Massachusetts Attorney General:
  • Attorney General Martha Coakley has entered into an agreement with California based WMD Capital Markets, LLC that provides significant benefits to approximately 200 borrowers holding structurally unfair loans originated by Fremont Investment & Loan (“Fremont”). WMD Capital Markets recently purchased the Fremont-originated loans, which are subject to a preliminary injunction [original injunction, expanded injunction] restricting foreclosures, issued by Suffolk Superior Court in February 2008.

  • The Attorney General’s Office and WMD Capital Markets reached an agreement to memorialize how Fremont-originated loans would be modified in order to avoid unnecessary foreclosures and account for Fremont’s unfair and deceptive lending practices that are the subject of the Attorney General’s law enforcement action against California-based Fremont.

Among the things WMD has specifically agreed to, according to the press release, are:

  • Permanently reset the applicable interest rate to the borrowers’ introductory rate,
  • In lieu of a loan modification, offer delinquent borrowers a relocation payment for one year after the agreement,(1) which is designed to help those borrowers who are unable to afford their mortgage loan, even after a downward adjustment of the monthly payment.

For the rest of the Mass AG press release, see AG Martha Coakley Enters into Affordable Loan Modification and Foreclosure Prevention Agreement with Purchaser of Fremont Loans.

See also, MarketWatch: WMD Capital Markets Purchases $65 Million in Massachusetts Mortgages (Deal Offers Homeowners New Financial Alternatives).

Go here for other posts on the battle between the Mass AG and Fremont Investment & Loan.

(1) The amount of the relocation payment was initially announced by the Mass AG's office as ranging from approximately $10,000 to $25,000. The reference to the relocation payment amount has since been removed by the AG's office. UndoMortgageLoans TILAdelta

CBS News' "The Early Show" On Philadelphia's Foreclosure Intervention Program

CBS News' The Early Show did a story this week on the Residential Mortgage Foreclosure Diversion Pilot Program recently instituted by Philadelphia, Pennsylvania.

For the video, see Philly Fights Foreclosures (The housing bill President Bush signed is designed to stabilize the weak housing market, but the city of Philadelphia is already a step ahead of the federal government).

For the transcript of the report, see Philadelphia Fighting Foreclosures Head-On (Forbidding Sale Of Foreclosed Homes; Forcing Lenders, Homeowners To Seek Compromise).

Another Lawyer Suspected In Swiping Foreclosure Surplus Proceeds?

In Brooklyn, New York, the NY Daily News reports:
  • A lawyer close to the Brooklyn Democratic machine is suspected of stealing $218,000 from an East Flatbush church in a mortgage foreclosure deal, the Daily News has learned. The Brooklyn district attorney's office is probing allegations that Alan Rocoff, the court-appointed referee for the foreclosure, refused to turn over the money to the Faithway Deliverance Center.

  • "My father founded the church with his own money and couldn't make the mortgage payments. When the property was foreclosed and sold, we were supposed to get what was left over," said Robert Booker Jr., son of the founding pastor of the Pentecostal church at 2525 Snyder Ave. [...] Five different judges have heard the case and ordered Rocoff to pay up, but he hasn't; nor has he been charged.(1)

***

  • Foreclosure referees, often appointed through connections with judges, are typically paid $1,000 for what amounts to two hours' work. It involves collecting and then depositing the cash proceeds of a sale with a court clerk for eventual disbursement.

  • The church property was sold on Nov.26, 2002, in foreclosure for $301,000. There was $218,556 left after the mortgage and other debts were paid.

For more, see Lawyer a suspect in church ripoff.

Go here for another story where an attorney is accused of swiping the surplus proceeds of a foreclosure sale.

(1) According to the Daily News report, Rocoff was appointed referee by his friend Brooklyn Civil Court Judge Michael Garson, who later admitted stealing $163,000 from an aunt's bank account. Garson was tossed off the bench. He quit the bar, reimbursed his aunt's estate and pleaded guilty to a misdemeanor to avoid jail.

Report Finds 59% Of NYS Foreclosures Linked To Subprime Loans, Minority Communities Targeted

In New York State, CNNMoney.com reports:

  • Mortgage scammers took advantage of loopholes in New York State lending laws to defraud homeowners and lending institutions all over the state, according to a new report released Thursday. The New York State Commission of Investigations reported that the state's mortgage borrowers need more regulatory protection from predatory lenders. It also linked subprime loans closely to New York's growing foreclosure problem; in 2007, 59% of all foreclosures statewide involved subprime loans.

***

  • In one example [of a case in which there was never any possibility that the borrower could afford to pay off a loan] from 2006, Suzette Francis, a woman with two young children, no assets, working as a $10-an-hour security guard and living in a homeless shelter, obtained a mortgage for $470,000 that, as the report stated, "exhibited ... every characteristic and feature associated with dangerous subprime loans." [...] She would have to work 400 hours a month just to pay her loan.

***

  • Particularly targeted all over the nation have been minority communities. The Commission found that, all other things equal, New York state African-American and Hispanic borrowers were twice as likely to have subprime loans as whites. A lot of 'one-stop-shops,' where real estate agents are also mortgage brokers, operate in minority neighborhoods," said Mary Biunno, senior assistant counsel for the Commission, "and they rope in a lot of people."

For more, see Foreclosures linked to subprime fraud (New York state investigation of subprime mortgage practices reveals fraud proliferated in the state, which had the eighth-highest number of foreclosures in 2007).

For the report, see A Perfect Storm: Easy Money and the Mortgage Meltdown - The Subprime Mortgage Crisis in New York State. PredatoryLendingRaceBias

Another Rent Scam Advertised On Craigslist Victimizes Arizona Family Of Nine Out Of $1,500

In Peoria, Arizona, KTVK-TV Channel 3 reports:
  • A family of nine thought they had found the perfect home, moved in and started to make improvements when they found out they had been ripped off. [...] The Reeves found the home listed for rent on Craigslist. It sounded like a bargain and a dream come true for this family of nine who was new to the area looking for a home. [...] They met who they thought were the owners and Matthew Reeves, the father, tells 3TV, “We signed the lease, got a receipt for the money…$1,500.” Then they went home to get the family and celebrate. That was on Thursday. On Friday the family started cleaning and Saturday showed up to move in but someone else was already inside.

For more, see Family new to Valley loses savings in Cragislist rental scam. (or go here for video).

Go here and go here for other posts on tenant victims of rent hoaxes. unwitting tenant rent scam yacht

Cleveland-Area Group To Start Program Notifying Tenants Renting Homes Going Into Foreclosure

In Cuyahoga County, Ohio, The Cleveland Plain Dealer reports:
  • [A] new program starting in August would notify tenants in Cuyahoga County that the property they're renting is being foreclosed on, giving them about six months to prepare to move. The program works by matching residential rental properties with foreclosure filings and sending letters to renters, notifying them and offering local resources for assistance in finding new housing.

  • The early notification would also give renters a chance to save money needed for the security deposit on a new home and other extra costs, said Mike Piepsny, executive director of the Cleveland Tenants Organization, which will be mailing the foreclosure notices. [...] Paul Herdeg, housing manager with Cuyahoga County's Department of Development, said funding sources also are being sought to lend financial aid to tenants facing eviction.

For more, see Program to notify renters of foreclosure filings (Often aren't aware of foreclosure).

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

Concerns Over Integrity Of Mortgage Industry’s Foreclosure Eviction Practices Of Tenants Alarm Cook County Sheriff’s Office

In Cook County, Illinois, The Chicago Reporter reports:
  • In many cases, the [tenant foreclosure] evictions have been legal. In others they’re not because mortgagees—a bank or company that collects mortgage payments— fail to give tenants ample notice or an opportunity to contest the eviction in court. In some cases, [...] the evictions are illegal because there is no court order against the tenants themselves.

  • In Cook County, tenants facing an illegal eviction often learn about it when they open their door to a sheriff’s deputy telling them to leave. Sometimes, [...] the deputies’ orders instruct them to evict the landlord, not the tenant. If tenants are home and can verify their identity, the deputies leave and report back to the lender.

  • Problems arise when tenants aren’t home, said Martha DiCaro, an assistant chief who runs the Eviction, Levy and Warrant Unit of the Cook County Sheriff’s Office. “We are under the impression that the person whose name is on the order is the person who lives there,” DiCaro said. “We take the court’s order at face value and we enforce it.”

  • Concerns over the integrity of the mortgage industry’s eviction practices have alarmed the sheriff’s office.

For more, see A Renter's Nightmare.

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

Six Seniors In Hospice Care Home In Foreclosure Get Booted As Landlord Pockets Rent, Stiffs Bank; Ambulances, Medics Called In To Carry Out Eviction

In Henderson, Nevada, the Las Vegas Sun reports:

  • The six senior citizens were strung to IV drips in a Henderson home converted into a geriatric care facility. The hospice home, a big stucco beast, was leased. The tenants, a couple who cared for the aging adults, never missed a rent payment. The owner of the house, however, was hardly so diligent. He lived outside the state and beyond his means. He stopped paying the mortgage and never said a word. Hello, foreclosure.

  • Henderson deputy constables went to the home in March 2007 with a judge’s order: Everybody out. Even the seniors sinking into their sheets had to clear out — within 24 hours. The bank wanted its house back, like, now. This was the first anybody in the home had heard of the foreclosure.

  • Ambulances were called to transport the elderly evictees. Temporary housing had to be hustled up overnight. Last-minute medical specialists had to be hired. The whole thing made your stomach turn, Henderson Constable Deputy Director Stephen Kilgore said.

***

  • On June 2, members of the [Nevada Legislature's] Subcommittee on Mortgage Lending heard testimony from Deputy Director Kilgore, who shared the geriatric home horror story.

The [Nevada] Legislative Commission Subcommittee on Mortgage Lending and Housing, a group researching legislation to protect renters, is planning to draft legislation that would make it a felony for homeowners to hide looming foreclosures from renters, according to the story.

For more, see When renter pays, owner doesn’t: You’re out, tenant.

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

Go here for other posts on Police involvement in foreclosures. SheriffDeputiesForeclosureAlpha TenantRentSkimmingAlpha

Legal Mechanisms In Connecticut Protect Tenants In Foreclosed Homes Against Short Notice Evictions, Loss Of Security Deposit

In Connecticut, the New Haven Register reports:

  • Amy Eppler-Epstein, an attorney for New Haven Legal Assistance Association, Inc., said there are only two ways a bank can evict a tenant in Connecticut: by naming the tenant in the foreclosure lawsuit or after winning the lawsuit, bringing an eviction case. In most instances, tenants can seek a stay of up to six months through the court.

  • "If you get legal papers, don't ignore them," she said. Rather, get legal advice. Low-income tenants [in Connecticut] can call Statewide Legal Services at 1-800-453-3320. Banks often offer a "cash-for-keys" arrangement, meaning they offer the tenant a certain amount of money to move by a specific date and avoid eviction proceedings. In [renter Aurea] Ortiz's case, she was offered $500 but could not find a new home by Wells Fargo's cutoff.

  • "If a tenant can find a place in short order, that could be a good deal for them," Eppler-Epstein said. But if not: "They cannot just put you out in a week. You have the right to go to court." Renters should keep proof they paid a security deposit, she said, because whoever owns the unit when the tenant moves out is liable to return the money, whether or not it was ever placed in escrow.

For more, see Stuck in the middle: Renters swept up in wave of foreclosures.

See also, Hartford Business Journal: Foreclosures Blindsiding Renters:

  • [T]here are legal mechanisms that can protect [Connecticut] renters, including a six-month stay of execution on evictions if the tenant is not the cause of the notice, [attorney Richard] Tenenbaum said. But few tenants are aware that they have a legal right to contest being thrown out, he added. TenantRentSkimmingAlpha