Case Conclusion Date: April 1, 2001
Practice Area: Real Estate
Outcome: Case Settled
Description: When the Balcom family went to refinance their Fort Lauderdale house in 1997 two years after buying it, they were floored to learn that their mortgage had been sold - to a parade of different lending companies. All wanted payment in full. It took more than three years for the Balcom's attorney, Roy Oppenheim, two judges, and a private mediator to unravel what had happened. The Balcom's ultimately discovered they were among at least a dozen victims of fraud allegedly committed by an employee of one of the the mortgage companies. The Balcom's saga began in 1995, when they bought the $430,000 house on Bayview Drive in Fort Lauderdale. They borrowed nearly $335,000 from SC Funding Corp., a mortgage broker with which Bob Balcom's credit union put him in touch. (SC Funding is now defunct and has been named in a lawsuit brought by California investors who accuse it and several related companies of promoting a $23 million Ponzi scheme.) Two years later, when the Balcoms went to refinance the house, they learned that their mortgage had been sold to two different lending institutions. The title company said it would not refinance the house until both mortgage companies were paid and the title counterfeit papers to fraudulently sell the mortgage and note to at least two banks. At least 12 other homeowners around the country also were victimized. To complicate matters further, the Balcoms began to receive letters from several banks, each asserting that their mortgage was the authentic one. Ultimately, their credit report showed they owed $330,000 to as many as four mortgage companies. Meanwhile, a company called Option One Mortgage Corp., which eventually proved it held the mortgage, sued the Balcoms for nonpayment on three separate occasions. And on three separate occasions Broward County judges dismissed the cases. But finally, Option One agreed to mediation and a "quiet title action," a process by which a mortgage holder proves it is legitimate. This lengthy process took six months.