Currently, Florida is the top state for mortgage fraud and has triple "the expected amount of reported mortgage fraud and misrepresentation for its origination volume," according to the Orlando Business Journal. Anyone can be the victim of a Central Florida mortgage scam, but the elderly are particularly at risk. You just don't expect that a wealthy widow who owns the historic Howey mansion would be among them.
Marvel Zona owned the former home of citrus grower and politician William J. Howey along with her late husband, Jack. Awed by the European feel, they bought the place in 1984 for $400,000. In 1996, the property was in trust in Marvel's name. With Jack in failing health, she obtained a reverse mortgage for $347,126 which would pay her a fixed income for life. Jack passed away in 2000.
In 2003, Zona approached Lake County officials about buying the home to turn it into a museum. Though the county was interested, the property, on the National Register of Historic Places, was not eligible for state historic preservation funds and was considered too costly to renovate. Over the years, Zona opened the home to public tours with the profits going to charity.
In 2005, Zona was approached by a would-be buyer, who convinced her that if she took out a $1.2 loan, leveraged by a mansion she owned in Boone, NC, she could pay off the reverse mortgage. The man and his partner wined and dined Zona, convincing her that the reverse mortgage was a bad deal and that if a buyer comes along, it would be easier for her to sell, according to her son, Rick Ritter.
By April, 2006, 86 year old Zona agreed to a $1.2 million adjustable rate mortgage that offered a teaser rate of 1.25%. The rate could change monthly and rise to 9.95%. Though her income was less than $1,000 per month, her payments were scheduled for $3,178 for 30 years. Zona paid off the reverse mortgage as planned. Within two years, the home was in foreclosure and her North Carolina property gone.
This year, Zona's attorney, Linda Vasquez Littlefield, is still fighting the foreclosure. The original lender, Homecomings Financial Network has vanished while the Aurora Loan Service, which acquired the loan, is perpetually "unavailable
At this point, the issue is not that Zona is being rendered homeless, as she is in a nursing home, but that she was victimized and her estate decimated. In the past, when local officials tried to investigate, the kindly Zona refused to press charges. She even turned down offered to buy the home. Littlefield is arguing that the loan was "allegedly predatory and fraudulently underwritten."
Her motion also states: "When Mrs. Zona told the lender's agent that she could not afford to pay the proposed loan, the lender's agent told her ‘not to worry about it' and that she could take out a hard money loan on her other property that was at the time free from any encumbrances."
Though the Zona fraud began at the height of the real estate boom, courts in Florida and elsewhere are overwhelmed with fraud cases. With the recent tide of foreclosures, more and more are susceptible to fraud and scams as they try to work out of their problems.
The Attorney General's office has warned troubled homeowners to be wary of "helpful" companies that make false promises, often in return for cash up-front. Their website lists companies to watch for. If you suspect a scam, can call 1-866-9-NO-SCAM or file a complaint online at myfloridalegal.com Better yet, before this even happens, you can seek help from a HUD-approved housing counselor, your lawyers, or even your lender.
There is help for you if you are in danger of losing your home. Janice Petteway and the Exit Results Real Estate team are committed to help you prevent foreclosure and help you examine alternatives. She can also help you find the home of your dreams in the Orlando and other Central Florida cities.
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