the good news for Helen Williams is that two years after receiving an initial foreclosure notice, she hasn’t lost her house. The bad news is that she still doesn’t know whether she will be able to keep it.
The 71-year-old retiree, whose case was spotlighted earlier this year in CommonWealth (“Broken Homes,” Winter ’09), is still nervously waiting to see if she will be able to work out a modification to a mortgage she never should have received and whose payments she can never hope to meet. Her plight has drawn the attention of the FBI, which sent two agents to interview her in August.
to hear whether she’ll be able
to keep her home.
In 2005, Williams refinanced her three-family house on Corona Street in Dorchester for $395,000 with the West Roxbury office of Home Run Mortgage, a now-defunct mortgage broker. The firm financed the loan through a subsidiary of Ameriquest Mortgage, the notorious predatory lender, also now shuttered, on whose board Gov. Deval Patrick once sat.
The loan was arranged by a broker named Jay Harris, someone Williams was referred to by a friend of her daughter’s. He acted as though he was there to help her out, explaining how the loan would let her consolidate the two different home loans she then had on the house, plus give her $50,000 in cash to carry out needed repairs. In reality, it seems Harris was more interested in helping himself out.
Williams’s closing papers listed an astonishing $10,522 in closing costs. And Harris convinced her to sign over an additional $5,000 to him directly, telling her he otherwise would receive no commission for his work. Williams claims income of only $703 a month in Social Security plus $2,669 from the two apartments she rents in her house. She was shocked when she looked carefully at the closing papers after the loan was made and saw that the broker had listed her income as $7,500 a month. Inflating a borrower’s income, which is illegal, was a widely practiced tactic by brokers during the heyday of the reckless subprime lending that helped send the global economy into a tailspin.
In February 2007, after falling several months behind on the monthly payments of $2,400, Williams received an initial foreclosure notice. With other debts also mounting, she filed for bankruptcy four months later, a move that puts a hold on any further foreclosure proceedings. Earlier this year, Williams came out of bankruptcy, a step that is necessary in order to pursue any type of modification of a mortgage loan.
Williams has been putting about $2,000 a month into an escrow account, the amount she says she could afford to pay in a reworking of her loan. She has contacted Bank of America, which now holds the loan, and even hired a lawyer to help her, but she has not been able to get an answer.
Richard Ravosa, the attorney she hired, says all he can get out of Bank of America is word that “they are evaluating her case.” He says the bank should take into account the highly questionable actions of the originating broker.
“My loan has to be modified. Everything was crooked,” Williams says of the misrepresentations on the loan application.
She evidently isn’t alone anymore in her belief that all wasn’t on the up-and-up. In August, Williams says, two FBI agents paid her a visit and spent an hour and a half looking at her loan papers and asking her and her daughter lots of questions, including details about the broker and even the layout of the office where the closing took place. “I asked them if they are going to press charges or anything,” says Williams. They told her “they are investigating.”
Special agent Gail Marcinkiewicz, a spokesman for the Boston FBI office, says she can neither confirm nor deny the existence of an investigation. But she says the office does have a mortgage fraud working group that is pursuing possible cases along with FBI offices across the country.
“They should go to jail,” Williams said last year of those she says took advantage of her, while emphasizing that her main priority is simply being able to keep her home.
Depending on how things go, perhaps she’ll get both wishes.
