Deal With Lenders Will Allow Woman to Retain Home
A woman who faced eviction after paying more than 28 years of a 30-year, HUD-backed mortgage will get back her house in South-Central Los Angeles under a tentative settlement with two mortgage companies, her lawyer said Friday.
The deal was reached after the woman, Lee Mary Hamilton, was flooded with offers of help from people who read of her plight in The Times. The case provoked action by Los Angeles city officials and by U.S. Sen. Dianne Feinstein (D-Calif.), who wrote to Andrew Cuomo, secretary of the Department of Housing and Urban Development, asking him to intervene.
The lenders--Fannie Mae and Alliance Mortgage--agreed to buy back the house from a Newport Beach real estate speculator who bought it at a foreclosure auction, according to Hamilton’s Legal Aid lawyer, Tai Glenn.
“They just fixed it instead of taking a hard line on it, which I think was smart and just plain right,” Glenn said. “I’m proud of them for doing the right thing.”
Hamilton was less magnanimous, saying the lenders should never have foreclosed on the house in the first place.
“What goes around, comes around,” she said. “They were trying to scam on me, and now it’s turned around on them.”
Hamilton, 62, bought the tiny house on West 63rd Place in 1970 for $11,250 under a federal program designed to encourage home ownership among the poor. She stopped making payments in 1998, insisting that she had prepaid the loan and did not owe any more money. Alliance, acting through a trustee, foreclosed despite a letter from HUD saying that she might be right and asking the lenders to drop the matter and write off the remainder of the loan.
In June, the house was sold for $26,675 to Jess Mendoza, who had bought several nearby homes at foreclosure auctions and resold them. He quickly moved to evict Hamilton. She refused to move and has been fighting the eviction.
After the newspaper story, Glenn said, the lenders agreed to buy back the house from Mendoza. Mendoza and a lawyer for the lenders, Robin Wright, said they were near agreement on a price. They would not say how much Mendoza was seeking, although he said it was more than $2,500 above his purchase price.
A spokesman for Fannie Mae, Clyde Ensslin, said he could only confirm that “tremendous progress” had been made toward a settlement.
As part of the proposed deal, Glenn said, Hamilton agreed to drop a lawsuit against the lenders. She said Hamilton will have 60 days to determine whether she owes any more money on the mortgage.
Glenn said Hamilton had received about 20 offers of help from private individuals. One woman sent her a check for $3,500, and others promised to send money as well. The $3,500 should cover the balance of the loan, assuming the lenders are correct in saying that Hamilton has not prepaid.
Glenn said the city of Los Angeles had offered to help by writing off an $8,500 home improvement loan to Hamilton and filing a friend-of-the-court brief in her behalf.
