Legal Question in Real Estate Law in California

Preatory Lender

Re-financed 2/homes. Loan Agent referred by a friend.

After $19,000 in fees, an a payment that was supposed to save me money each month is now going to make me lose my home & the home of my mother. The loan agent isn,t licensed and the mortage comp. is saying she didn't do the loan another person did an we need to re-finance. Gave up a 5.75/30 yr.fixed/and was put on the same loan I already had for the other house.

The finance comp/has sent another person out to re-fi an that we were explained in full, but the un-licensed person

was so mis-informed & didn't explain what the future payment would be or what the true loan was.

It was late after work when she came by to sign papers & she notarized it also. I realize I put my trust in her, all

she said was what a good Christian she was

The same person made my friend almost lose

her home an is now saying she is a (Financial Invester).

I feel false promises & deceptice sales tatics, were used.

I know of another person she almost made lose $100,000 in

equity. My equity is being depleted each month. Since I got

this loan in June my loan has gone from 316,000 to 320,000.

They are on my answere machine talking about re-fi.

Do I have any recoarse against her or the finance co?

Asked on 2/02/06, 1:46 am

3 Answers from Attorneys

Judith Deming Deming & Associates

Re: Preatory Lender

Sounds like you got mixed up with a loan fraud scam. Some brokers allow unlicensed individuals to use their license to broker loans and they split the loan fees--this is clearly illegal, but usually those who get caught up in the mess, as you apparently have, do not have the money to fund a lawsuit against those involved. You have recourse against all who knowingly participated, but can you afford to pursue them? We have and are pursuing a number of unlicensed individuals and the brokers who assisted, but I can tell you it is costly, and until a recovery is obtained the plaintiff must have the funds to file suit and pay his attorney, and that could cost tens of thousands to get it to trial (although settlement may be acheived before trial). At a bare minimum, you can file a complaint with the California Department of Real Estate against the broker whose license enabled the loan, as he has a legal duty to oversee the actions of those operating under his license.

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Answered on 2/02/06, 12:56 pm
Nate Bernstein Nate Bernstein & Associates, Attorneys and Counselors at Law

Re: Preatory Lender

You may have a cause of action for recission and fraud- its depends on the specific circumstances, and what was disclosed at the time the mortgage documents were prepared. Collection may be difficult if the mortgage company does not have deap pockets. This is also a preliminary statement, and not a final opinion. Thanks.

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Answered on 2/02/06, 4:36 pm
Edward Ardzrooni Law Offices of Edward Ardzrooni

Re: Preatory Lender

You have recourse. How effective and quick is the recourse depends on a number of things.

It is very important that you and your mother meet and confer with a civil litigation attorney as soon as possible; and do so with ALL of the documents and advertising "come-on" flyers available to show the attorney.

It is likely that you will have to osue both the company and the unlicensed agent in order to get conpensation. The suit need not necessarily go all the way through to trial, but without a lawsuit, it is rare that people and companies like those who swindled you will make recompense.

If your defendants are financilly "flush," youare legally entitled to claim (and often can get awawrded by the courts) treble damages because the case is fraud. It is also poSsible that you can collect reimbursement for your attorney fees in bringing the culprits to justice.

Your friend, who you say was also defrauded, probably has the came rights.

Of course, your right to recourse depends on the actual facts. But by what you say, you seem to have a strong case to start with.

But it is important that you act quickly, and not let these people get away or disappear.

I am willing to meet with you and your mother (or, if necessary, with you alone) at my office for a 90-minute consultation without any fee charge to either of you -- juast in order to enable the three of us to get a "real handle" on this mess you and your mother and hour friend have ben sucked into.

LawGuru does not allow me to put my phone number into this letter of response; but they do allow me to provide my office address and e-mail address.

You may e-mail me your phone number if you wish, and I will call you back.


Edward Ardzrooni

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Answered on 2/02/06, 11:01 am

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