Post Exclusive | Homeowners Seeking Lifeline – Underwater Owners Try to Beat the Bank
By Kimberly Miller
Palm Beach Post Staff Writer
By the time the stranger called that Thursday in March, suburban Boynton Beach homeowner Marcie Lowe was out of options to fix her failed real estate wager.
The savvy 78-year-old played her hand well for years in the home-buying game, picking up properties in California and Key West to rent to kids in college and bartenders serving drinks on Duval Street.
But she got caught with a 10 percent interest-only loan on her gated Valencia Isles home, which is now worth hundreds of thousands of dollars less than the $571,000 she paid in 2003.
“What would you think of this?” Lowe remembers the caller saying.
He proposed a fresh strategy to end-run the banks — a complex legal plan that begins when you deed your home to the Fort Lauderdale-based Fidelity Land Trust Co. for an average fee of $2,500.
Conceived, at least in part, by a man barred by the state from engaging in consumer debt-related services, the trust then sues the bank to cancel your mortgage while offering a new contract with lower payments.
“He said more than 250 people were already set up for this,” Lowe recalls.
Fidelity Land Trust has quietly amassed about 80 Palm Beach County deeds since it registered as a limited liability corporation with the state in December.
The firm is the owner of record for another 76 properties in Broward and Miami-Dade counties, according to clerk of court records.
If the trust is successful in canceling the mortgage through a quiet title action, the homeowner is still responsible for the loan debt, or note, but the trust then tries to buy that debt from the bank for pennies on the dollar.
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There are a lot of law that is not utilized to help homeowners cause most attorneys do not know about them!!!!
Absolutely true! And even fewer that would help or care even if they knew the law. Having said that I see the banks selling these houses for pennies on the dollar to liquidate so what is the difference. Settlements for pennies on the dollar are being tendered by second mortgage holders that have passed these loans down and down the line. So technically, it might be possible but sounds both risky and doubtful. Still, it might be better than nothing, which is what most of us are getting trying to modify our loans, nothing but trouble.
I have just completed a 5 or 6th “modification package” on my residence. This one so the attorney now defending the lender can ‘bill’ to handle, analyze, or pass along the package before the lender says “no” again! Exhausting my options, the lender will then sell my confiscated house for a fraction of what they could have gained if modified.
No logic here!
I think I’ll just sit back and see where this ends up.Could work but legal I don’t know.
Might be easier in the judicial states. Here in Tennessee no one stops foreclosure unless a suit or bankruptcy petition is filed and few have been effective to date. The courts get stopped on ‘default’ and obligation with little regard for the petitioner.