Report: Lender ‘took a beating’ on Rep. Laura Richardson’s foreclosure

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The Daily Breeze reports that Rep. Laura Richardson (pictured) made only a few payments on the Sacramento house she bought in 2007, failed to pay property taxes, defaulted on the mortgage, and lost the house to foreclosure. The Daily Breeze reports that Richardson’s lender, Washington Mutual, took a loss of nearly $200,000 when it sold the house at a public auction on May 7.

‘They took a beating,’ James York, the Sacramento real estate broker who said he bought Richardson’s house at a foreclosure auction, told the Daily Breeze.

The Daily Breeze report is based on public documents the newspaper published on its website, and an interview with York. It is at odds with Richardson’s statement yesterday, in which the Long Beach Democrat said she had worked out a loan modification with her lender, and would ‘fulfill all financial obligations’ on the property.

The Daily Breeze: ‘Rep. Laura Richardson lost her Sacramento home in a foreclosure auction two weeks ago, and left behind nearly $9,000 in unpaid property taxes. Richardson, D-Long Beach, appears to have made only a few payments on the house, which she bought in January 2007 for $535,000.’

The newspaper’s report -- that the house was foreclosed and an auction took place -- appears to conflict with Richardson’s statement that the house ‘is not in foreclosure.’ (see the entire statement at the bottom of this post). Richardson’s office has not responded to a request from L.A. Land for additional information about her mortgage and loan modification. The Daily Breeze reports she declined to be interviewed about the controversy.

The newspaper’s report also calls into question Richardson’s statement that she had worked out a loan modification with her lender and would fulfill all financial obligations related to the property. The Daily Breeze reports that the house sold for only $388,000, far below the $574,000 that Richardson owed on the property. Further, the Daily Breeze reports that the new owner, York, ‘assumed responsibility for Richardson’s unpaid property tax bill of $8,950.79.’

‘Tell Laura I’d be happy to have her pay my property tax,’ he told the newspaper.

Photo Credit: L.A. Times

Click below to read Richardson’s statement issued Wednesday.

CONGRESSWOMAN LAURA RICHARDSON

For Immediate Release
May 21, 2008

The story published in the Capitol Weekly regarding residential property that I own in Sacramento requires clarification.

Within a 12-month period last year (2007-2008), I was a member of Long Beach City Council, the District Director for California Lt. Gov. Cruz Bustamante, a member of the California State Legislature, and, now a member of Congress. While the transitioning has impacted me personally, the residential property in Sacramento California is not in foreclosure and has NOT been seized by the bank.

I have worked with my lender to complete a loan modification and have renegotiated the terms of the agreement -- with no special provisions. I fully intend to fulfill all financial obligations of this property.

On two housing bills that were cited by the Capitol Weekly, the allegation is that I recused myself from these votes. I did not. I was absent from Washington, D.C., and my duties in the House of Representatives due to the untimely death of my father and his subsequent funeral in California.

I understand that these homeownership issues are a reflection of what many Americans are going through as they fight to keep their homes and to remain financially stable.