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Tag: foreclosure

  • Bunker Hill tower One California Plaza goes into receivership

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    A financially troubled skyscraper in downtown Los Angeles has gone into receivership as office landlords there struggle to keep their buildings leased.

    One California Plaza — the gleaming 42-story tower on Bunker Hill that was one of the most prestigious addresses in the city when it opened in the 1980s — has dropped 74% in value from its market peak.

    Earlier this year, the owners defaulted on their $300-million debt, set to mature in November, and faced foreclosure.

    At the request of lenders, a judge appointed Trigild, a receivership service, to take control of the 1 million-square-foot property, the Real Deal reported.

    One California Plaza is appraised at $121.2 million, down from $459 million in 2013, according to a Morningstar Credit report, real estate data provider CoStar said.

    Net cash flow at the property trailed expectations by 37% last year, and the building is now 62% leased after the departure of major tenants, including law firm Skadden, Arps, Slate, Meagher & Flom, which is set to relocate to Century City.

    Ownership of the property at 300 S. Grand Ave. includes Los Angeles landlord Rising Realty Partners, which declined to comment on the receivership. Co-owner DigitalBridge, a Boca Raton, Fla., investment company, did not respond in time for publication.

    In recent years, the downtown office market has shifted against landlords as many tenants have reduced their office footprints in response to the COVID-19 pandemic, when it became more common for employees to work remotely.

    Elevated interest rates recently have weighed on prices by making it difficult for building owners to refinance debt, pushing them into quick sales or foreclosures.

    Some downtown L.A. office tenants have expressed concern that the streets feel less safe than they did before the pandemic and have left for other local office centers, including in Century City.

    Downtown L.A. has 54 office buildings that are at immediate risk of devaluation and could result in nearly $70 billion in lost value over the next 10 years, creating a potential loss of $353 million in property tax revenue, according to a recent report by BAE Urban Economics.

    The report suggested converting some of them to housing because they potentially could have more value as apartments or condominiums, which could help mitigate expected tax losses.

    Converting just 10 big office buildings to housing would boost their combined assessed property value over a decade by $12 billion, adding $46 million in tax revenue and creating more than 3,800 residential units, the report said.

    The Gas Company Tower on Bunker Hill sold for around $200 million to Los Angeles County last year, down 68% from a $632-million valuation just four years ago, according to CoStar. The 777 Tower at 777 S. Figueroa St. was sold last year for $120 million, a 70% drop from its 2013 sale. EY Plaza at 725 S. Figueroa St., once valued at $446 million, is now worth about $150 million, a 66% decline.

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    Roger Vincent

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  • David Pisor Faces Foreclosure Suit Over Aya Pastry in West Town

    David Pisor Faces Foreclosure Suit Over Aya Pastry in West Town

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    As the new owner of Etta Collective attempts to distance itself from the bankruptcy filings of former owner David Pisor, the banks are pressing forward with efforts to collect debts. Records show Pisor has defaulted on the $1.4 million mortgage for the West Town building that houses Aya Pastry.

    Wintrust Bank has filed a lawsuit against Pisor and also lists his former business partner, Jim Lasky, in the complaint. Lasky’s attorneys have reiterated that their client has been long removed from Aya’s operations stemming from an acrimonious split between the parties in 2023. The two also founded Maple & Ash in Gold Coast and Etta. The latter had multiple locations while a Bucktown restaurant remains open under the new ownership of a Texas tech company. Johann Moonesinghe is the founder of InKind and took over Aya Pastry earlier this year after he won an auction for Etta Collective’s assets. Moonesinghe is now the tenant at 1332 W. Grand Avenue and tells Crain’s he’d be interested in buying the Aya building if it were made available. In Scottsdale, Arizona, an Etta outpost was recently sold to RDM Hospitality, an Austin, Texas company. The restaurant will relaunch in late September with renovations and a new modern Italian menu, according to a news release.

    Back in Chicago, Aya Pastry’s namesake, acclaimed pastry chef Aya Fukai, left the bakery in 2023, but her name remains on all the branding. Fukai, who worked with Laksy and Pisor at Maple & Ash, opened the bakery with the pair in 2017. Her recipes also remain and several local coffee shops stock their pastry cases with doughnuts and croissants from the bakery. Fukai isn’t listed as a defendant in Wintrust’s lawsuit, filed Tuesday, September 10 in Cook County circuit court. Pisor kept Fukai’s departure quiet while dealing with the fallout from separating from Lasky. Over the summer, Lasky and chef Danny Grant announced expansion plans for the bar inside Maple & Ash, called Eight Bar. There’s hope of opening multiple locations across the country, and the duo has plans for Maple & Ash and Eight Bar combo in Miami. The steakhouse holds the cachet of being one of Restaurant Business Online’s highest-grossing independent restaurants in the country and tops in Chicago.

    Last year, several former Etta workers protested, citing lapses in healthcare coverage and other operational concerns with Pisor. Meanwhile, Pisor tells Crain’s that he looks forward to resolving the matter concerning Wintrust quickly, describing the bank’s lawsuit as a baseless attack and a “technical default.”

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    Ashok Selvam

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  • MetLife Forecloses on Starwood, Artisan Office in El Segundo

    MetLife Forecloses on Starwood, Artisan Office in El Segundo

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    MetLife Investment Management foreclosed on an El Segundo office building owned by Starwood Capital and Artisan Ventures, The Real Deal has learned. 

    MetLife paid $72.8 million for 1960 East Grand Avenue through a non-judicial foreclosure last month, according to a trustee’s deed filed with Los Angeles County. 

    Starwood and Artisan owed $83.9 million under a roughly $85 million loan from MetLife on the property, provided in 2020, records show. 

    The firms defaulted on the loan in February, prompting MetLife to schedule a foreclosure on the 257,000-square-foot building. 

    A representative for Starwood Capital and Artisan co-founder Mark Laderman both declined to comment. MetLife did not respond to a request for comment.

    Many office owners have chosen to hand back the keys on properties, given many lenders have pulled back from financing office buildings in light of remote work and a lack of tenant interest. Few buildings across Los Angeles County have actually gone through a non-judicial foreclosure — other landlords and lenders have agreed to deeds-in-lieu of foreclosure or receiverships. 

    MetLife’s foreclosure deal, which came to $283 a square foot, was roughly a 45 percent discount compared to what Starwood and Artisan paid for the property in 2020. 

    Starwood and Artisan acquired the building from a Brookfield fund, and had planned to redevelop an adjacent parking lot into 94,000 square feet of office space and a new parking structure. However, the plans never came to fruition. 

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    Isabella Farr

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  • House approves plan to end ‘equity theft’ in foreclosure sales

    House approves plan to end ‘equity theft’ in foreclosure sales

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    BOSTON — The state House of Representatives has approved a proposal to stop “equity theft” from property owners who fall behind on their local taxes, which comes in response to federal and state court rulings that deemed the practice unconstitutional.

    The bill, which passed Wednesday by a vote of 154-0, would establish a process allowing delinquent property owners to claim “excess equity” within 60 days of a foreclosure sale or seizure by local governments.

    The excess equity would be determined by deducting the tax title account balance owed to a local government on date of a foreclosure judgment, the cost of appraisal, and other related expenses, according to the proposal. Property owners would need to file a claim to recoup the excess equity.

    The changes are a matter of fairness to property owners who shouldn’t lose equity in their home that they’ve built up over years because of an unpaid tax bill, lawmakers said.

    “No one, and no entity, should gain a windfall profit in a split second by stealing every bit of equity someone else has built over decades or a lifetime,” state Rep. Tram Nguyen, D-Andover, said in remarks ahead of the bill’s passage. “Not here. Not anywhere.”

    Another architect of the bill, state Rep. Mark Cusack, D-Braintree, said the changes are aimed at “protecting property owners and making towns whole” and ensuring that excess equity is “returned to the rightful owners.”

    To help prevent property owners from slipping into foreclosure, the proposal would require local governments to provide advanced notice to people who have fallen behind on their taxes and at risk of having a lien placed on their property.

    Movement on the legislation comes amid pressure on lawmakers to act following a series of court rulings over the past year holding that government can’t take value of someone’s property beyond taxes owed without reimbursement.

    A 2023 U.S. Supreme Court issued a ruling in a Minnesota tax foreclosure case that effectively deemed the practice unconstitutional by siding with a 94-year-old woman over her claim that a county government violated the Constitution by keeping a $25,000 profit when it sold her home in a tax foreclosure sale.

    Chief Justice John Roberts wrote in the ruling that taxpayers are only required to pay the government what it is owed and anything beyond that is an unconstitutional taking of property.

    “The taxpayer must render unto Caesar what is Caesar’s but no more,” Roberts wrote, in a reference to biblical scripture.

    In April, a Massachusetts judge added to the pressure on lawmakers to take steps to comply with the high court’s ruling. Superior Court Judge Michael Callan’s ruling in a Hamden County lawsuit deemed the law “unconstitutional,” saying “the statutory scheme, in its present form, is untenable and requires Legislative correction.”

    Massachusetts is among a dozen states, plus Washington, D.C., with tax foreclosure laws allowing local governments or investors to take dramatically more than what is owed from homeowners who slip into default.

    Under the state’s foreclosure law, cities and towns can sell or keep tax liens on delinquent properties. The lienholder — whether it’s a local government or investor — can file for foreclosure once the debt is six months old.

    Once a property is foreclosed on, the lienholder gets a deed and can keep or sell it. A lienholder can keep profits from the sale, under the law.

    Critics of the practice, including the Boston-based New England Legal Foundation, argue that if the government seizes a home to collect overdue taxes the homeowner should be allowed to collect the surplus revenue from the sale once the taxes are paid.

    Dan Winslow, the foundation’s president, said the House’s plan to fix the law “strikes a fair balance between the need for cities and towns to collect taxes for local services while protecting homeowners from being cheated out of their hard-earned equity.”

    A 2022 report by Pacific Legal Foundation found homeowners in Massachusetts and other states collectively lost more than $777 million in savings on more than 5,600 homes based on their market value, above what they owed in taxes. On average, homeowners lost 86% of their equity, the group said.

    Local governments, which often sell properties for a fraction of market value, collected about $26 million more than they were owed on 1,300 homes, the report said.

    Meanwhile, private investors collected an estimated $250 million more than they were owed on about 2,600 homes, the report’s authors said.

    In Massachusetts, the report identifies about 315 homes in the state — including several in Lawrence — that have been affected by home “equity theft” totaling more than $48 million.

    The House’s excess equity proposal must be approved by the state Senate before heading to Gov. Maura Healey’s desk for consideration.

    Christian M. Wade covers the Massachusetts Statehouse for North of Boston Media Group’s newspapers and websites. Email him at cwade@cnhinews.com

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    By Christian M. Wade | Statehouse Reporter

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  • Riley Keough fights off foreclosure and auction of her grandfather Elvis’ Graceland

    Riley Keough fights off foreclosure and auction of her grandfather Elvis’ Graceland

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    Elvis Presley’s granddaughter is suing an investment and lending company to halt a foreclosure sale of the late singer’s famed Graceland mansion.

    Actress Riley Keough, who inherited the Memphis property after the death last year of her mother, Lisa Marie Presley, and a settlement with grandmother Priscilla Presley, obtained a temporary restraining order against a sale of Graceland by Naussany Investments & Private Lending LLC. The sale was initially scheduled for May 23, according to CNN.

    Keough’s lawsuit, which was reviewed by The Times, claims that the company presented documents “purporting to show that Lisa Marie Presley had borrowed $3.8 million from Naussany Investments and gave a deed of trust encumbering Graceland as security.”

    Keough denied that her mother had any involvement with Naussany Investments, claiming that the documents were “fraudulent” and possibly forged.

    Florida notary Kimberly L. Philbrick, whose signature appears on the alleged agreement between Lisa Marie Presley and Naussany Investments, claimed in an affidavit that she did not notarize the documents.

    “I have never met Lisa Marie Presley, nor have I ever notarized a document signed by Lisa Marie Presley,” Philbrick’s affidavit read. “I do not know why my signature appears on this document.”

    “Lisa Marie Presley never borrowed money from Naussany Investments and never gave a deed of trust to Naussany Investments,” the lawsuit read.

    Moreover, the lawsuit alleged that Naussany Investments was seemingly created “for the purpose of defrauding” and could be a “false entity.”

    Naussany Investments did not immediately respond to The Times’ request for comment.

    Elvis Presley Enterprises, which manages the Presley estate, also called the claims fraudulent and told The Times in a statement that there is no foreclosure sale.

    “Simply put, the counter lawsuit [that] has been filed is to stop the fraud,” the statement read.

    Priscilla Presley, Elvis’ widow, also weighed in with an Instagram post on Sunday.

    “It’s a scam!” read bright red letters over a photo of the Graceland mansion.

    Keough was officially named the sole trustee of Lisa Marie’s estate and, by extension, Elvis’ estate in November after a judge approved a settlement between her and Priscilla, 78.

    As part of the settlement, Keough agreed to make a $1-million lump-sum payment to Priscilla that will be funded by Lisa Marie’s $25-million life insurance policy.

    The settlement also provides that Priscilla will be buried at Graceland in the closest gravesite to the King of Rock ’n’ Roll and will maintain a role as special advisor in dealing with Elvis’ estate, for which she will be paid $100,000 a year.

    The legal tensions arose after Priscilla contested Lisa Marie’s will following her death last January at age 54. Specifically, Priscilla questioned “the authenticity and validity” of a 2016 amendment that removed her and former business manager Barry Siegel as trustees in place of Lisa Marie’s eldest children, Keough and her brother, Benjamin Keough, who died in 2020 at 27.

    The family reached a settlement last May, which was later approved by L.A. Superior Court Judge Lynn H. Scaduto.

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    Angie Orellana Hernandez

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  • California’s biggest cannabis delivery company faces foreclosure – Cannabis Business Executive – Cannabis and Marijuana industry news

    California’s biggest cannabis delivery company faces foreclosure – Cannabis Business Executive – Cannabis and Marijuana industry news

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    California’s biggest cannabis delivery company faces foreclosure – Cannabis Business Executive – Cannabis and Marijuana industry news




























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    AggregatedNews

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  • Bank of SoCal Lists Santa Monica Apartments for Sale

    Bank of SoCal Lists Santa Monica Apartments for Sale

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    Bank of Southern California has listed three apartment complexes in Santa Monica for sale — properties formerly owned by developer Neil Shekhter, The Real Deal has learned. 

    NMS Properties’ Neil Shekhter

    The bank foreclosed on the three buildings at 1038 10th Street, 1007 Lincoln Boulevard and 1516 Stanford Street in February, L.A. County records show, after Shekhter defaulted on almost $16 million in loans tied to the properties. 

    At a public auction, Bank of Southern California foreclosed with a credit bid of $9.5 million, coming out to about $394,000 per unit.

    Now the bank is asking $10.8 million for the three buildings, which together total 24 units, according to listings on LoopNet for the property. At that price point of $450,000 per unit, Bank of Southern California could recoup some of its loss that came from Shekhter’s unpaid debt. A team led by JLL’s Luc Whitlock is marketing the portfolio for sale. 

    Shekhter paid about $10.6 million for the three buildings between 2015 and 2016, property records show.

    The buildings can be bought individually or as one portfolio, according to the LoopNet listing. Almost half of the units will be vacant at the time of sale. 

    The properties could be bought by owner-occupiers — someone who could occupy one of the units and rent out the rest, according to JLL’s marketing materials. 

    Shekhter and his firm, WS Communities, had refinanced the three properties in September 2022, using a business loan from Bank of Southern California, court records show. 

    Shekhter’s sons Adam, Alexander and Alan Shekhter, each signed unlimited personal guarantees with recourse, meaning if the properties could not pay back the loan, the brothers would be personally liable for paying it back, according to court documents. 

    Bank of Southern California had sued Shekhter’s sons over the defaulted loans, claiming the three “failed and refused, and continue to fail and refuse, to pay the sums due and owing to plaintiff, in breach of said guaranty,” court records show.

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    Isabella Farr

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  • Oheka foreclosure delayed again as defaulted loan heads to auction | Long Island Business News

    Oheka foreclosure delayed again as defaulted loan heads to auction | Long Island Business News

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    A recent appeals court ruling has stalled the foreclosure of Oheka Castle, prompting the lender to auction off the property’s $28 million mortgage loan. 

    In June, the New York Supreme Court Appellate Division reversed an April 2019 lower court ruling that had granted summary judgment for Oheka lender U.S. Bank National Association, denying claims by defendant Kahn Property Owner LLC and its principal Gary Melius that the lender withheld escrow payments and failed to engage in good faith discussions on a possible loan workout agreement. 

    The Appellate Division decision ruled that the lender “failed to submit any business record” that substantiated the alleged loan default, temporarily halting the foreclosure process. 

    The unfavorable court ruling and a foreclosure process that has so far dragged on for more than six years, prompted U.S. Bank to put the Oheka loan on the market with Newmark, which is accepting offers for the loan through the auction site Ten-X. The non-performing loan, which has a current principal balance of about $28 million, has a minimum bid set at $9 million and its auction is scheduled to begin on Monday, Oct. 17. 

    Attorney David Rosenberg of Garden City-based Rosenberg Fortuna & Laitman, who is the court-appointed referee in the case, said the Appellate Division decision was made on a purely procedural point. He added that the lender or whoever ultimately buys the Oheka note, will likely make a new motion for summary judgment which would attempt to cure the procedural problem raised by the appellate court. 

    “This will likely delay the foreclosure process by several months if not longer,” Rosenberg told LIBN. 

    Interest on the Oheka loan continues to accrue at 11.6 percent annually and Rosenberg estimated that the amount due the lender as of three years ago was more than $37.2 million. The lender has also had to pay the annual property taxes on Oheka, which are currently listed as $282,575, according to public records. 

    It’s been a long and contentious road for the lender and its Miami Beach, Fla.-based special loan servicer LNR Partners in their attempt to foreclose on the 23-acre Oheka property. 

    LNR began foreclosure proceedings on the Oheka property in June 2016, claiming that Melius had defaulted on two commercial mortgage-backed securities loans totaling more than $29.79 million. Melius, who rescued the once-decaying building in the 1980s and turned it into an iconic catering and event space, had countersued to dismiss the foreclosure action and was seeking damages of at least $10 million from LNR. 

    In Jan. 2019, the court appointed Jeffrey Kolessar, vice president of Philadelphia-based GF Management, as receiver to oversee operations at Oheka. Kolessar continues to get 2.5 percent of gross revenues from the property as a commission for his services and is entitled to be compensated for “reasonable out-of-pocket expenses,” according to court filings. 

    Kolessar declined to comment on the amount he has received from Oheka’s revenue. 

    Originally built for financier Otto Kahn in 1921, the 126-room Oheka–listed on the National Register of Historic Places–was abandoned and crumbling when Melius took ownership in 1984. Over the years he’s spent millions in renovations, including more than 450 new windows and doors, 4,000 pieces of slate to repair the roof and the planting of more than 3,000 trees and bushes, according to court papers. 

    Melius has not responded to requests for comment. 

    The Newmark loan listing describes the Oheka property at 135 West Gate Drive in Huntington as an “unmatched luxury historic hotel and event venue with remarkable structure and site improvements, featuring a level of both detail and grandeur that could not be cost-justified today.” The listing says the opportunity “presents prospective purchasers with the ability to acquire a unique and sizable non-performing loan offering a substantial opportunity and various resolution strategies.” 

    The Newmark team marketing the Oheka loan includes Steven Schultz, Tony Georgiev, Brock Cannon and Dan Oliver.  

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    David Winzelberg

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  • Proveedores De Servicio De Modificación De Préstamos De California Discriminaron a Propietrarios Hispanos

    Proveedores De Servicio De Modificación De Préstamos De California Discriminaron a Propietrarios Hispanos

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    Press Release
    –

    Aug 25, 2016


    California, U.S., August 25, 2016 (Newswire.com)
    –
    ​​​El Departamento de Justicia de EE.UU. ha entablado una demanda en la que alega que varios proveedores de servicios de modificación de préstamos hipotecarios violaron la Ley de Vivienda Justa y la Ley de Igualdad de Oportunidades de Crédito por intencionalmente discriminar a propietarios hispanos.

    Los demandados nombrados en la demanda son: The Home Loan Auditors LLC, Century Law Center LLC, SOE Assistance Center Inc., Spieker Law Office, intencionalmente dirigieron sus servicios de modificación de préstamos hipotecarios predatorios propietarios hispanos e interfirieron en su capacidad de recibir asistencia financiara para conservar sus hogares.

    La demanda entablado martes, 23 de agosto de 2016 en el Tribunal Federal de Distrito del Distrito Norte de California alega que los demandados exhibían una práctica de comercialización a propietarios hispanos, incentivándolos a que pagaran alrededor de $5.000 por auditorias de préstamo innecesarias e inefectivas. Los demandados enfatizaban que las auditorías eran esenciales para la modificación de préstamo. En realidad, las auditorías no tenían ningún impacto en el proceso de modificación y no proporcionaba ningún beneficio financiero.

    En parte del servicio de modificación de préstamos que publicitaban, los demandados incluso dirigían a sus clientes que dejaran de realizar los pagos de sus hipotecas y que dejaran de comunicarse con sus prestamistas. Esto resulto en que muchos propietarios pasaron a estar en situación de mora en el pago de sus cuotas hipotecarias y finalmente llegaron a perder sus hogares.

    Esta demanda surgió de denuncias presentadas al Departamento de Vivienda y Desarrollo Urbano de EE.UU. por dos ex clientes de los demandados.

    “Tener como objetivo intencional a cualquier comunidad o persona con servicios hipotecarios predatorios debido a su grupo étnico u origen nacional viola la ley federal, perjudica a familias trabajadoras y hace daño a nuestra economía entera,” señaló la Secretaria de Justicia Auxiliar Adjunta Principal Vanita Gupta, a cargo de la División Civil del Departamento de Justicia.  “Los demandados en este caso trataron de explotar a comunidades hispanas y propietarios que ya sufrían debido a prácticas financieras abusivas y discriminatorias durante la Gran Recesión que causó la crisis del mercado de la vivienda de EE.UU. y la caída libre de nuestra economía.  La demanda entablada por el Departamento de Justicia sirve de fuerte recordatorio y transmite el claro mensaje de que trabajaremos sin descanso para permitirles a todos los propietarios de vivienda acceso a servicios hipotecarios libres de discriminación.”

    “Las familias hispanas que luchan por permanecer en sus hogares no necesitan promesas vacías que solo empeoran su situación de vivienda y financiera,” señaló Gustavo Velásquez, Secretario Adjunto de Vivienda Justa e Igualdad de Oportunidades con el Departamento de Vivienda y Desarrollo Urbano de los Estados Unidos.  “HUD se siente complacido que el Departamento de Justicia esté actuando contra personas y compañías que victimicen a dueños de casa debido a su país de origen o porque hablen español u otros idiomas.” 

    Cualquier persona con información sobre los servicios de modificación de préstamos prestados por The Home Loan Auditors LLC, Century Law Center LLC, SOE Assistance Center Inc. o Spieker Law Office debe comunicarse con la Sección de Vivienda y Cumplimiento de la Ley Civil de la División de Derechos Civiles llamando al 1-800-896-7743, presione el 2 para continuar en español y seleccione la opción 5 o escribiendo a THLALawsuit@usdoj.gov

    El comunicado de prensa original del Departamento De Justicia de EE.UU. se puede econtrar aqui: https://www.justice.gov/espanol/pr/el-departamento-de-justicia–alega–que–proveedores-de-servicio-de-modificaci-n-de-pr

    Se encuentra una copia de la demanda, así como información adicional sobre las iniciativas del Departamento de Justicia, de cumplimiento de ley asociadas al otorgamiento de préstamos justos, en www.justice.gov/fairhousing. 

    Para cualquier duda o inquietud adicional por favor contacte: inquiries@heraca.org

    This press release can also be found in English: https://hera.newswire.com/news/california-loan-modification-service-providers-discriminated-against-14208659 

    Source: Housing and Economic Rights Advocates

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  • California Loan Modification Service Providers Discriminated Against Hispanic Homeowners

    California Loan Modification Service Providers Discriminated Against Hispanic Homeowners

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    Press Release
    –

    Aug 25, 2016


    California, U.S., August 25, 2016 (Newswire.com)
    –
    ​​​​​​​​​​​​The Justice Department has filed a lawsuit alleging that several mortgage loan modification service providers have violated the federal Fair Housing Act and Equal Credit Opportunity Act by discriminating against Hispanic homeowners. 

    The defendants, The Home Loan Auditors LLC, Century Law Center LLC, SOE Assistance Center Inc., Spieker Law Office, targeted Hispanic homeowners for predatory mortgage loan modification services and impeded the homeowners’ ability to receive financial assistance to maintain their homes. 

    The complaint filed August 23rd, 2016 in the U.S. District Court for the Northern District of California alleges that the defendants marketed and encouraged Hispanic homeowners to pay approximately $5,000 for unnecessary and ineffectual loan audits. The defendants indicated to the homeowners that audits were essential for a loan modification while in fact the audits did not impact the loan modification process and did not provide any financial benefit.

    As part of their mortgage service the defendants encouraged their clients to stop making mortgage payments and to end all communication with their lenders. This led many homeowners to default on their mortgage payments and ultimately led them to lose their homes.

    This lawsuit originates from complaints filed with the U.S. Department of Housing and Urban Development (HUD) by two of the defendants’ former clients. 

    “Intentionally targeting any community or person with predatory mortgage services because of their ethnicity or national origin violates federal law, harms working families and hurts our entire economy,” said Principal Deputy Assistant Attorney General Vanita Gupta, head of the Justice Department’s Civil Rights Division.  “The defendants in this case tried to exploit Hispanic communities and homeowners already suffering from abusive, discriminatory financial practices during the Great Recession that drove the American housing market into crisis and our economy into freefall.  The Justice Department’s lawsuit serves as a stark reminder and sends a clear message that we will work tirelessly to ensure that all homeowners can access mortgage services free from discrimination.”

    “Hispanic families struggling to stay in their homes do not need empty promises that make their housing and financial situation worse,” said Gustavo F. Velasquez, HUD’s Assistant Secretary for Fair Housing and Equal Opportunity.  “HUD is gratified that the Department of Justice is taking action against individuals and companies that victimize homeowners because of where they come from or because they speak Spanish or other languages.”

    Anyone with information on the loan modification services provided by The Home Loan Auditors LLC, Century Law Center LLC, SOE Assistance Center Inc. or Spieker Law Office should contact the Civil Rights Division’s Housing and Civil Enforcement Section at 1-800-896-7743 (press 1 to continue in English, and select option 5) or at THLALawsuit@usdoj.gov

    Original press release from the United States Department of Justice can be found at: https://www.justice.gov/opa/pr/justice-department-alleges-california-loan-modification-service-providers-discriminated

    A copy of the complaint, as well as additional information about fair lending enforcement by the Justice Department, can be found at www.justice.gov/fairhousing.  

    For any additional questions or concerns please contact Housing and Economic Rights Advocates (HERA) at: inquiries@heraca.org

    Este comunicado de prensa también se puede contrar en español:  https://hera.newswire.com/news/proveedores-de-servicio-de-modificaci-n-de-pr-stamos-de-california-14229459 

    Source: Housing and Economic Rights Advocates

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