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Goodbye plywood: Fannie Mae no longer allows plywood in pre-foreclosure

In November, Fannie Mae announced that mortgage servicers would be not only allowed but reimbursed to use clear boarding instead of plywood when securing houses that were in pre-foreclosure.

That announcement was not retroactive, meaning it only applied to new pre-foreclosures, not homes already in pre-foreclosure status.

But that’s not the case anymore, as Fannie Mae announced this week that it is moving away from plywood entirely.

In a bulletin sent to servicers this week, Fannie Mae said that it “no longer accepts plywood boards as an acceptable boarding solution on windows of its properties.”

The bulletin stated that servicers are now required to replace any and all plywood boarded windows on homes in pre-foreclosure with clear boarding or a replacement window.

And servicers have 90 days from the announcement’s effective date, March 29, 2017, to re-glaze/repair or clear board all unsecured and previously plywood boarded windows, Fannie Mae said.

The announcement doesn’t apply to homes in REO status, but for pre-foreclosures, plywood is now only allowed in very specific circumstances: if the home is “severely fire damaged” or in pre-demolition.

Plywood is also allowed on non-window openings, but servicers are encouraged to contact Fannie Mae on a case-by-case basis.

Fannie Mae’s bulletin also states that outside of those instances, the use of plywood is not allowed, even in short-term circumstances.

“Plywood must not be used on windows on properties that secure a Fannie Mae loan (non-HECM),” Fannie Mae said in the announcement.

“Servicers are allowed seven days to secure a property, including re-glazing/repairing or clear boarding, from the first time it is discovered vacant,” the announcement continued. “If it is discovered that windows need to be re-glazed/repaired or clear boarded any time after the initial secure timeframe, the appropriate service should be performed within three days of discovery.”

Fannie Mae said that where feasible, it prefers re-glazing or repairing the broken windows, but notes that the servicer or field services vendor should determine the appropriate strategy.

Cost, number of windows, likelihood of additional breaks, etc. should all be considered when making that decision, Fannie Mae said.

But Fannie Mae states that if a property with re-glazed/repaired windows is subsequently compromised, clear boarding must be used.

On clear boarding, or polycarbonate windows, Fannie Mae said that there are currently two products, SecureView and InvisiBoard, which have its approval.

“Currently, SecureView and InvisiBoard have demonstrated that their products have the appropriate quality and installation materials/processes as well as an appropriate level of impact resistance, thickness and translucency,” Fannie Mae said in the announcement.

Fannie Mae said that in addition, it will allow a minimum of 3/16th inch polycarbonate clear board.

“Fannie Mae is open to the development and use of other products but requires that those products be demonstrated in the field and approved by Fannie Mae prior to use,” the bulletin continued, adding that acrylic and Plexiglass products are not acceptable.

Robert Klein, founder and chairman of Safeguard PropertiesCommunity Blight Solutions and SecureView, hailed the announcement.

“I think it’s phenomenal,” Klein told HousingWire this week.

“The last announcement was a game-changer,” Klein continued, referencing the Fannie Mae’s announcement from November.

“This is going to change the industry,” Klein said of the new announcement. “It’s going to change blight. This is the first proactive approach to dealing with these properties. It’s a game-changer on steroids. This is the right thing to do. Fannie Mae is the trailblazer.” 

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New Firms Catching Up to Banks in Foreclosure Rankings

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CB council pursues deal to regain deed restricted Poverty Gulch property

 Mid-April conclusion expected for situation

By Mark Reaman

In its quest to gain control of an affordable housing unit that went into foreclosure in the Poverty Gulch project, the Crested Butte Town Council last week held an emergency meeting.

The board gave the okay to the town attorney and town staff on March 23 to negotiate with another lien holder on the property and make a deal to essentially purchase their lien and redemption rights for no more than $12,000.

The town had already paid the Poverty Gulch Homeowners Association $9,235 for the rights to its lien on the property. That was the amount in past dues owed by the unit’s owner, Jim Harlan.

That action put the town in line to redeem the certificate of purchase that was bought at a Gunnison County trustee’s auction by local Realtor Mindy Sturm earlier this month for $93,000. A resolution is being prepared for the April 3 Town Council meeting to approve “the payment of $93,000 and such other amounts necessary to redeem the certificate of purchase issued to Mindy Sturm.”

According to Gunnison County deputy treasurer and public trustee Teresa Brown, per Colorado Revised Statutes, a junior lienor has the right to acquire the property if they have a valid lien and have filed a timely Notice of Intent to Redeem along with the other required documentation. The town of Crested Butte, as the assignee of the HOA lien, did file the required Intent to Redeem along with the appropriate documentation.

Brown explained that the town of Crested Butte would have the first right of redemption. The Certificate of Purchase holder (Sturm) submitted her Statement of Redemption outlining the costs associated with her purchase of the certificate by Monday, March 27. The statement included the amount paid at sale, interest and allowable fees and costs and was close to $97,000. Sturm included attorney fees incurred as a result of a failed negotiation with the town.

The town has until noon on Tuesday, April 4 to exercise its right to redeem and if the town does so, the trustee, Brown, will issue a certificate of redemption to the town. The Town Council will consider an emergency ordinance on Monday, April 3 authorizing the redemption costs for the unit to not exceed $125,000.

“The redemption payment will be given to the Certificate of Purchase holder (Sturm),” Brown said. “The Certificate of Purchase holder is not able to stop the process of redemption. They must accept the payment. The next junior lien holder will then have an additional five business days to redeem. Once all redemption periods have ended I will issue the Confirmation Deed to either the last redeeming party or if no redemption has been made, to the holder of the Certificate of Purchase.”

Sturm has issues with process

Sturm was not pleased with the process with the town in this particular case. Despite a comment from town attorney John Belkin asserting that Sturm rejected a deal with the town, Sturm states, “I did not reject any offer. I met with Dara McDonald, Michael Yerman and John Belkin and was open to further dialogue but they were not prompt in responding to my questions. When they did respond, they were vague and the information supplied to me (both oral and written) was misrepresentative of the situation. They were not giving me the full picture so I could make a decision.

“On Monday of last week, the town manager called and said their offer was off the table and they were proceeding with their redemption rights,” Sturm continued. “I filed a Statement of Redemption this week, that included attorney fees and other costs related to the sale. Because the town was giving me the run around, I had to retain counsel to give me an opinion on my position as well as the town’s. To me, this whole thing would have been a lot easier and the town could have had that property for a lot less if they had exercised the option to purchase, or succeeded at the foreclosure sale. Why neither of those avenues were accomplished is a mystery to me. The town authorized the purchase of the unit for $104,000. Considering that I live and work in this town, I am frustrated by the lack of professionalism in this situation.”

“Throughout the foreclosure process, the town explored all of our options to retain the unit,” said MacDonald. “Unfortunately, due to the tight timeframes, the town and Mindy were not able to come to terms amenable to both parties.”

Council expressed some concern at the emergency meeting with possible litigation over the Poverty Gulch unit foreclosure, but Belkin said there was always a chance for litigation in almost any situation.

Future issues at stake?

At last week’s emergency meeting the council asked staff if the rest of the town’s deed-restricted affordable housing stock was protected in foreclosure situations or if the town would have to follow similar procedures as this in the future.

“I imagine there are a number of units that could be subject to stuff like this,” said town attorney John Belkin. “Other municipalities are dealing with similar issues so it depends on the documents that have been filed with a particular property.”

Crested Butte town manager Dara MacDonald said she and town planner Michael Yerman have talked about conducting an inventory of the town’s affordable housing resources. “It is a concern that we want to get ahead of,” MacDonald told the council.

“There are 203 separate deed restrictions in town, without including the Anthracite Place project,” said Yerman. “Over the decades, things have been recorded differently and deed restrictions vary from property to property. We definitely need to get ahead of this, so we want to look at this. We want to keep taking steps forward and not take steps backward.”

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Neighborhood of the week: In N. Kingstown’s Heritage Hills, it’s life in the slow lane

The name Heritage Hills originally applied to a subdivision. That development and surrounding areas contain lots of an acre or less with houses that range from stately colonials to ordinary raised ranches. In general, the closer they are to Route 102, the closer they trend to 2,500-plus square feet of living space.

NORTH KINGSTOWN, R.I. — Lesser known than the villages of Wickford, Wickford Junction, Lafayette and Slocum is a part of town known as Heritage Hills, just south of another place called Rural Gateway.

If Route 102 (Ten Rod Road) and Route 2 (South County Trail) are the crosshairs in a circle that describes Rural Gateway, we’re looking at a set of roads southeast of that, across Route 2 from the Exeter landmarks of Stamp Farm, Schartner Farms and Hallene Farm.

The name Heritage Hills originally applied to a subdivision. That development and surrounding areas contain lots of an acre or less with houses that range from stately colonials to ordinary raised ranches. In general, the closer they are to Route 102, the closer they trend to 2,500-plus square feet of living space.

New to the neighborhood are Fox Hollow and Field’s End roads. The last of 10 two-unit condo buildings are still under construction in Fox Hollow, which starts across Route 2 from the greenhouses at the Schartner farm store. Field’s End may refer to the field of blueberry bushes that ends at four new single-family houses in the same development.

On a sunny afternoon recently, Dave and Joyce Pearson walked from their new condo on Fox Hollow Road to the corner with Field’s End, stopping to pick up their mail at a cluster of mailboxes.

Both in their 70s, the Pearsons needed a smaller house with fewer stairs than what they left in South Kingstown. They also liked the idea of not having to shovel or mow. They were the fourth household to move in.

From their street, it’s less than two miles to the Super Stop Shop just off Route 4 at Exit 5. Even from one of the colonials on Beacon Drive or Stone Hill Drive, it’s little more than two miles to the store, as well as to bus and train service.

Children in the neighborhood go to Stony Lane Elementary and Wickford Middle School. North Kingstown High School, the farthest, is about five miles away.

Hatchery Road leads to the state’s Lafayette Trout Hatchery, an interesting destination for a walk.

Farther south is Dry Bridge Road, which gets increasingly commercial toward Exeter Road in the Slocum area. Two-family houses lining the odd-numbered side of Dry Bridge seem to be from another era and a different part of the country. Built in the early 1970s, some have flat roofs with roof-like exterior walls sloping almost to the lawn, giving them the look of a mansard-roofed house without a ground floor.

Seven properties are listed for sale among the nearly 350 dwellings in the Heritage Hills area. Three have an asking price of $379,900, and two of those are condos, both with 1,900 square feet, 2 bedrooms and 2.5 baths, at 116 and 110 Fox Hollow Rd. The other is a single-family house with 3 bedrooms and 2.5 baths in 1,852 square feet at 29 Collins Court. Two other condos are priced at $20,000 less.

At the other end of the scale, a single-family house at 155 Hatchery Rd. with 2 bedrooms and 1 bathroom in 1,159 square feet is listed at $125,000, a bank foreclosure sale.

In the town as a whole, the median sale price of the 338 houses that sold in 2015 was $320,000. For the area east of Route 2 between Route 102 and Dry Bridge Road, the 10 houses that sold had a median price of $450,000.

In 2016, the 424 houses sold townwide had a median price of $354,750. In the area east of Route 2 between Route 102 and Dry Bridge Road, the five houses that sold had a median price of $375,000.


(401) 277-7411

On Twitter: @donita22

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Scarborough Power of Sale and Foreclosures Stopped by

Scarborough, ON — (SBWIRE) — 03/29/2017 — Ron Alphonso of is a renowned real estate expert with special skills in stopping foreclosure and power of sale which a significant portion of Scarborough’s population is facing. Ron has a decade of experience in stopping the dreaded foreclosure or power of sale situation. He specialises in distressed mortgages and has access to private lenders who also contribute to stopping the legal acquisition of property. Private lenders accept people with low income or bad credit but they will not lend to low equity. Experts advise people with insufficient equity to simply vacate the property as there is no possible resolution. There are many reasons why this might occur including divorce, loss of income or illness which cause the individual to miss mortgage payments. The result is loss of a property through a power of sale or foreclosure.

It can take only six months from initial default to execute a power of sale and this is far much cheaper for the lender than a foreclosure which drags on for long. There are often multiple lawyers involved in a foreclosure as well as several court appearances, which makes a power of sale the better option for mortgage holders looking to recoup. The speedy process may be economical for lenders but unfortunately, homeowners have very little time to resolve matters and this leads to loss of treasured properties. Initially, there will be a Notice of Default sent, followed by a Statement of Claim and Notice of Eviction before the Sherriff’s Eviction Notice.

Also known as the Notice to Vacate, the Sherriff’s Eviction Notice involves the Sherriff removing the owner from the property. This notice comes with an eviction date when the Sherriff has legal right to forcefully remove the owner from a property if need be. Once the process starts, it is nearly impossible to stop unless with the assistance of an experienced professional.

Few people in Scarborough want to lose their homes in this way and so they try to stop the legal acquisition. The best resolution is to pay up monies demanded by lawyers or lenders but this is not possible without cash in hand. Banks do not loan to people facing a power of sale or foreclosure so they have to seek alternatives from private lenders. To get the money, a borrower can seek a second mortgage with which they can pay initial mortgage holders and bring the loan to good standings. Second mortgages are also open, meaning that the homeowner may choose to end it at any time. But this of, the course attracts a penalty in three months’ interest fees.

Being a veteran in real estate, Ron Alphonso has been able to stop Scarborough power of sale and foreclosure using different techniques. A new mortgage, replacing existing loans and selling off the property before eviction date are some of his tricks that often save people from losing their valuable homes to mortgage holders. To ensure speedy resolution, individuals must bring all documents regarding the power of sale so Ron knows exactly which course of action to take.

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Mnuchin’s OneWest Eluded Most Penalties During Foreclosure Crisis

Llewellyn Hinkes-Jones

OneWest Bank, the mortgage servicer previously owned by now-Treasury Secretary Steven
Mnuchin, avoided numerous lawsuits and settlements that affected other banks after
the 2010 foreclosure crisis, a Bloomberg BNA analysis showed.

Compared with other banks, it was given a relatively light penalty during the Independent
Foreclosure Review (IFR) by the Office of Thrift Supervision (OTS)—a 2011 review of
potential foreclosure abuse by mortgage servicers that weren’t part of the National
Mortgage Settlement.

OneWest also avoided successful prosecution in class action lawsuits over foreclosure
abuse, while numerous other banks entered into large-scale settlements. Also, a California
state investigation into the bank was never filed “despite a strong recommendation”
by the attorney general’s office according to a leaked memorandum from the attorney
general’s office.

David Dayen, an author and researcher on the foreclosure crisis, told Bloomberg BNA
that the federal government’s response was weak for all banks involved in the foreclosure
crisis, but that OneWest used numerous tactics to avoid scrutiny at the state and
federal level.

Homeowner advocacy groups such as the California Reinvestment Coalition repeatedly
accused Mnuchin of running OneWest as a “foreclosure machine” for its actions during
the foreclosure crisis, an allegation Mnuchin denied in his January 2017 confirmation
hearings in Washington.

numerous complaints and
details of voluminous foreclosures by the bank raise questions about whether the financial institution avoided penalties
because it was innocent of foreclosure abuse or avoided censure by some other means.

Foreclosure Machine Allegations

Representatives of legal aid and housing counseling organizations called OneWest one
of the worst servicers they had dealt with in terms of abuses such as dual tracking—simultaneously
pursuing foreclosure while negotiating loan modifications—and encouraging borrowers
to default on their loans, during the 2015 hearings by the Office of the Comptroller
of the Currency (OCC), over allowing OneWest to merge with CIT Bank.

J.D. Power and Associates, a marketing and consumer survey organization, ranked OneWest
the third-worst mortgage servicer in 2010 and fourth-worst in 2012.

A Freedom of Information Act request made by the homeowner advocacy group California
Reinvestment Coalition to the Department of Housing and Urban Development
(HUD) showed that OneWest’s subsidiary, Financial Freedom, was responsible for 39
percent of foreclosures on reverse mortgages from 2009 to 2014, even though it only
serviced 17 percent of all reverse mortgages.

Based on that number, the bank foreclosed at three times the combined rate of every
other reverse mortgage servicer.

In his Treasury nomination hearings, Mnuchin denied the foreclosure machine allegations
as “inaccurate.”

Mnuchin stated that HUD forced the bank to foreclose because of Federal Housing Administration
(FHA) rules and that OneWest did whatever it could to provide mortgage adjustments
to those in need.

A representative from HUD did not respond to a request for comment about which regulation
Mnuchin was referring to that would force a mortgage servicer to foreclose on a borrower.

In 2015,
HUD implemented a policy to move all past-due-tax and insurance-delinquent borrowers of reverse mortgages
to a “due-and-payable category”
to avoid the large costs that FHA was burdened with from past-due accounts.

During the hearing, Mnuchin also highlighted reviews he said showed that OneWest had
the “most effective loan modifications of any bank.”

Numbers from the U.S. Treasury analyzed by Bloomberg BNA show that only one-quarter
of Home Affordable Modification Program
(HAMP) applicants for OneWest were approved, ranking the bank squarely in the middle
of reviewed banks.

Mnuchin also insisted that the bank never robo-signed documents and that the Department
of Housing and Urban Development
(HUD) often forced the bank to foreclose according to Federal Housing Administration
(FHA) rules.

In 2009, an employee for OneWest admitted to robo-signing documents—processing and
signing more than 6,000 a week without knowing their contents and without the presence
of a notary—
in a deposition for a case involving the bank.

Sandy Jolley, a reverse mortgage suitability and abuse consultant who testified at
the hearings, contested Mnuchin’s statements about HUD to Bloomberg BNA.

“HUD doesn’t have the system or structure in place to enforce, regulate or audit these
rights and protections; the servicer is 100 percent in control of the servicing and
foreclosure, not HUD,” she said.

Neither a representative for CIT Group, which bought OneWest in August 2015 nor HUD
responded to a request for comment.

Foreclosure Crisis Penalties

OneWest was not included in the National Mortgage Servicer Settlements, which investigated
banks for foreclosure abuse allegations, such as signing foreclosure documents without
an notary present or confirming that their contents were accurate.

Instead, it was part of a similar Independent Foreclosure Review (IFR) by the Treasury’s
Office of Thrift Supervision (OTS) with only a minimal penalty as a result.

The IFR focused on identifying borrowers who might have been harmed by errors or misrepresentations
in foreclosure documents. OneWest was one of the few banks to complete the IFR process,
but it did so on its own, without oversight by OTS.

The IFR forced most banks to pay back from $2,000 to $3,000 per in-scope borrower,
on average. For OneWest, it was $44 per borrower on average and only 5 percent of
borrowers were due remediation.

All other banks paid out between $84 million to $2.9 billion in total remediation,
OneWest paid out only $8 million.

A representative for the U.S. Treasury’s Office of the Comptroller of the Currency,
which the OTS is now a part of, declined to comment for this story.

The OTS investigation was eventually described as highly flawed in
a 2013 Government Accountability Office report, which took it to task for poor organization and an inability to identify an exhaustive
number of harmed borrowers.

Internal Bank of America documents obtained by ProPublica showed that the IFR investigators relied on the banks for their research, tainting
the investigation.

Kevin Stein, deputy director of the homeowner advocacy group California Reinvestment
Coalition, told Bloomberg BNA that the IFR was “possibly the worst regulatory scheme
we have seen.”

David Dayen, an author and researcher on the foreclosure crisis, told Bloomberg BNA
that the IFR investigation was weak across the board, previously referring to it as
“neither independent nor a review,” and said that OneWest used numerous tactics to
avoid scrutiny at the state and federal level.

“They were clearly very aggressive when it came to investigations into their practices,”
he said, but he also added that most banks escaped the foreclosure crisis relatively

Lawsuits Against OneWest

OneWest has been a party to hundreds of lawsuits related to foreclosure activity since
the foreclosure crisis, but all of them were dismissed or settled out of court, according
to an analysis by Bloomberg BNA.

OneWest sold most of their servicing portfolio to Ocwen Financial Corp., shortly after
the California Homeowner’s Bill of Rights (HBOR) took effect in January 2013, according
to Sean Coffey with the California Reinvestment Coalition.

Coffey said he believes that OneWest may have avoided legal scrutiny of its practice
by appealing to federal preemption—in which because of the bank’s status as a federally
chartered institution, federal laws preempted any state laws.

OneWest successfully used preemption to avoid class action lawsuits on force-placed
insurance abuse, but a 2016 appeal to preemption in the case

Boyle v. Vesuvio Holdings, Cal., S237962
to avoid prosecution under HBOR failed. The case is ongoing.

No Action From CFPB

No actions were brought by the Consumer Finance Protection Bureau (CFPB), based on
an analysis of legal cases and press releases from the agency by Bloomberg BNA.

A representative of the agency didn’t respond to a request for comment to confirm
that the agency hadn’t brought a case against the bank.

Few complaints against OneWest appear in CFPB’s consumer complaints database, according
to an analysis by Bloomberg BNA.

Out of 1,600 complaints for OneWest’s current parent company, CIT Group, only 17 refer
specifically to OneWest and 29 refer to Financial Freedom, OneWest’s reverse mortgage

CFPB also only started accepting complaints in 2011, after most of the foreclosure
crisis had already passed, Brian Simmonds Marshall, policy counsel at Americans for
Financial Reform, told Bloomberg BNA .

Kevin Stein indicated that the CFPB database may not be relevant here since most issues
with OneWest would be about their reverse mortgage subsidiary, Financial Freedom.

Because reverse mortgage borrowers are always seniors, they are less likely to file
complaints, according to Stein, because they would be unfamiliar with the database.

But Stein also believes that HUD has many more complaints than CFPB. A response to
a Freedom of Information Act Request by California Reinvestment Coalition from HUD
indicated that it would take hundreds of hours to complete the research to find all
of the complaints against Financial Freedom.

To contact the reporter on this story: Llewellyn Hinkes-Jones in Washington at

To contact the editor responsible for this story:
Paul Hendrie at

Copyright © 2017 The Bureau of National Affairs, Inc. All Rights Reserved.

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Toledano’s Brookhill files for Chapter 11 on EV buildings, and his $145M deal with Sutton is no longer happening

From left: 27 St. Marks Place, 66 East 7th Street, 223 East 5th Street, 514 East 12th Street and Raphael Toledano

UPDATED, 4:00 p.m., March 29: An affiliate of Raphael Toledano’s Brookhill Properties filed Chapter 11 bankruptcy protection on a 15-building East Village portfolio, according to bankruptcy documents reviewed by The Real Deal. Toledano was in contract to sell the portfolio to Joseph Sutton, son of retail mogul Jeff Sutton, for $145 million, but sources said that deal is now off the table.

The bankruptcy filing in U.S. Bankruptcy Court for the Southern District of New York, submitted on Tuesday, comes more than a month after Madison Realty Capital filed to foreclose on the package of multifamily walk-ups acquired by the 27-year-old landlord in 2015.

At the same time, Toledano, the controversial broker-turned-multifamily investor who runs Brookhill , was in contract to sell the buildings to Joseph Sutton, son of retail mogul Jeff Sutton, for about $145 million. Now that the deal with Sutton is no longer happening, Toledano is looking for other suitors, sources said.

The bankruptcy filing, submitted by Brookhill-controlled entity East Village Properties LLC, would buy Toledano more time to sell the buildings and avoid foreclosure.

Toledano and Sutton declined to comment. Sources familiar with the deal said that Sutton did not want to be associated with a deal tainted with a bankruptcy filing. Sources close to Toledano said he requested that Sutton exit the deal in a bid to increase his leverage with Madison. Sutton complied with this request, the sources said.

“It’s the standard playbook of lender trying to foreclose and debtor trying to stay that,” said portfolio manager Adam Stein-Sapir of Pioneer Funding Group, who is not involved.

“You have 18 months to file a plan of reorganization but parties can move to shorten the exclusivity period,” Stein-Sapir added. “Someone could challenge that and say it should only go to 60 or 90 days. In this case, it’s most likely to be one of the mortgage holders. It gives that party some leverage to direct the case, whereas the standard is for the debtor to direct their own case.”

Madison claimed in its filing that Toledano owes roughly $140 million, including $125 million in loans against the 15 properties, plus interest and attorneys’ fees. Madison, an investor-lender led by Josh Zegen and Brian Shatz, had provided the financing for Toledano’s $97 million purchase of the buildings in September 2015 from the Tabak family. The loan was intended to cover future renovation costs in addition to the acquisition, though industry sources had accused Toledano of being overleveraged.

The properties are 27 St. Marks Place, 66 East 7th Street, 514 East 12th Street, 223 East 5th Street, 229 East 5th Street, 231 East 5th Street, 233 East 5th Street, 235 East 5th Street, 228 East 6th Street, 253 East 10th Street, 323-325 East 12th Street, 327 East 12th Street, 329 East 12th Street, 334 East 9th Street, and 510 East 12th Street.

Adam Pincus contributed reporting.

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Marquette County treasurer cautions property owners in foreclosure danger

The taxes must be paid by 5 p.m. Friday, or they go into foreclosure.

At least 35 of the properties facing foreclosure qualify as homestead properties, Giroux said.

In Michigan, a house is treated as a homestead if it is the owner’s principal residence — a dwelling they live in for at least six months out of the year.

If the taxes are not paid, property owners lose all rights to the property and there is no further ability to redeem. Foreclosure is final, Giroux said.

“The property is owned by the county treasurer at that point,” Giroux said. “Those properties that are foreclosed on are made available to the state of Michigan, the local unit of government (township or city) and the land bank authority. If those entities do not acquire the property, it is offered at public auction in August.”

Giroux said it is not unusual to have more than 100 parcels on the foreclosure list, but this year that number is up almost 10 percent.

“We are up nine parcels,” Giroux said.

The 2014 property taxes became delinquent March 3, 2015, and were forwarded by the municipalities to the county treasurer for collection. At that time a 4 percent fee along with 1 percent interest per month was added.

At a glance

Those individuals who cannot afford to pay their 2014 property taxes on their primary residence should contact the Marquette County Treasurer’s Office to see if they are eligible for a one-year extension from foreclosure due to financial hardship.

The Marquette County Treasurer’s Office is also directing people to the Step Forward Michigan Program.

According to the Step Forward Michigan website, the program was established by the Michigan Homeowner Assistance Nonprofit Housing Corp. to help Michigan homeowners stay in their homes. The program provides interest-free loans of up to $30,000 to assist with mortgage, property taxes, and/or condominium association fees.

Each parcel with unpaid property taxes was forfeited to the county treasurer on March 1, 2016. This added a $195 fee to the tax bill, in addition to interest on the debt increasing from 1 percent to 1.5 percent.

Giroux said from this point on the county tries to contact the property owner with six first-class letters and one certified letter within a one-year period.

During this time in the process the landowner retains ownership of the property, despite the forfeiture, Giroux said.

According to a fact sheet from the Marquette County Treasurer’s Office about the process of delinquent tax collections, property owners are given notice even after the stage of forfeiture.

Between August and October 2016, county representatives made a personal visit to each property in danger of foreclosure.

If the taxes are not paid by Dec. 1, 2016, the timeline states, the property address and the names of all parties of interest are published in a newspaper.

In February, hearings were held and judgement of foreclosure was entered on the remaining parcels, the timeline states.

Giroux said in addition to the county efforts to contact landowners, Community Action Alger-Marquette staff reached out five months prior to foreclosure by mail and phone in cases where the property is considered a homestead.

Those individuals who cannot afford to pay their 2014 property taxes on their primary residence should contact the Marquette County Treasurer’s Office to see if they are eligible for a one-year extension from foreclosure due to financial hardship, Giroux said.

The Marquette County Treasurer’s Office is also directing people to the Step Forward Michigan Program.

According to the Step Forward Michigan website, the program was established by the Michigan Homeowner Assistance Nonprofit Housing Corporation to help Michigan homeowners stay in their homes.

The program provides interest-free loans of up to $30,000 to assist with mortgage, property taxes, and/or condominium association fees.

“These loans are forgivable at 20 percent each year, as long as the property remains the homeowner’s primary residence. This means that if a homeowner remains in their home for five years or more after the loan is granted, they do not have to repay the loan,” the website states.

Giroux said while it is not unusual for taxpayers to wait until the last minute to pay property taxes and avoid foreclosure, she suggests a more proactive approach.

“We caution people not to wait until the last day to pay for a variety of reasons — unforeseen accidents, weather or family emergencies just to name a few,” she said. “We also have many taxpayers who don’t understand that foreclosure is final. People who are familiar with mortgage foreclosure assume that there is a redemption period. However, tax foreclosure is different — on March 31, the redemption period has ended and they lose all rights to their property,” Giroux said.

Lisa Bowers can be reached at 906-486-4401. Her email address is

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Gwinnett man is 22nd convicted for rigging bids at foreclosure auctions

On the long list of those who profited from the misery of the Atlanta-area foreclosure crisis, you can add the name of Clifford Wayne Hill.

For more than four years, Hill, who conducted business through his company SalesForce Inc., conspired with others to rig foreclosure auctions in Gwinnett County, a federal indictment charged.

On Friday, Hill pleaded guilty to his role in the scheme, the Justice Department announced. He and fellow fraudsters submitted artificially low bids for the properties, depriving mortgage-holders and the home owners of money that might otherwise have gone to them, prosecutors said.

The group then held secret side-auctions to determine which schemer would get a specific property. Among the properties were homes in Suwanee, Buford, Dacula and Hoschton, court records show.

Hill is scheduled to be sentenced June 1.

By the government’s tally, he is the 22nd real estate investor to have pleaded guilty in the ongoing federal investigation of bid-rigging and fraud related to public foreclosure auctions in the Atlanta area.

Charges are still pending against one other person, Douglas L. Purdy.  His trial is scheduled for June 5, court records show. Purdy bought property at public foreclosure auctions in Forsyth County, according to a federal indictment. Beginning at least as early as July 2008 and continuing through at least December 2011, Purdy conspired to rig Forsyth County foreclosure auctions, the indictment alleges.

Among the properties were those in Cumming, Gainesville and Alpharetta, court records show.

The federal investigation has been going on for years. Read about others convicted in bid-rigging schemes here:

And here, with details on some of the earliest convictions:





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Bank of America fined $45 million for ‘heartless’ foreclosure …

A bankruptcy judge issued a $45 million fine against Bank of America Corp.

BAC, -0.55%

 , calling the bank’s treatment of a California couple who fought to save their home “brazen” and “heartless.”

Judge Christopher Klein of the U.S. Bankruptcy Court in Sacramento said the bank’s mortgage modification process and mistaken foreclosure on Erik and Renee Sundquist’s home left them in “a state of battle-fatigued demoralization.”

The case brings renewed attention to the mortgage industry’s loan servicing business. Klein alluded to systemic problems, saying the bank had little incentive to alter the mortgage terms and “kill a goose that keeps laying 6% golden eggs,” referring to the interest rate that the bank collected.

The fine money, earmarked mostly for law schools and consumer advocacy organizations, is meant to be large enough that it won’t “be laughed off in the boardroom as petty cash or ‘chump change,’” Klein said in the ruling, published Thursday. “It is apparent that the engine of Bank of America’s problem in this case is one of corporate culture…not rogue employees betraying an upstanding employer,” he added.

An expanded version of this report appears on

Why the bank of the future will look like an Apple store


As e-banking technology has improved, the number of bank branches is expected to fall by a third in the next decade. But rather than get rid of branches altogether, banks are trying to give them makeovers to get customers to still come in.

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