Modern Day Highwaymen Turning Dreams Into Nightmare By Annan Boodram & Felicia Persaud

Each day, throughout the nation, the American dream is being stolen. The thieves don't bother with jewelry, stereos or other possessions. Such items are worthless to them. Their eyes are on something much, much bigger -- homes.
These modern-day highwaymen use wonderful promises, complex mortgage notes, high-interest loans, hidden fees and a "trust me" smile to get you to sign on the dotted line. Their goal may be to lock you into high monthly payments you can barely afford. Or they simply want to pass off sub-standard houses that lead to never ending nightmares for the buyers. The results can be heartache, bottomless debt, bankruptcy and foreclosure -- the legal term for kicking you out of your own home.
And it's often done legally.
Just ask Tanshel Pointer and her mother-in-law. They are two victims of a housing fraud scandal involving federally backed home loans linked to some 450 properties in Brooklyn and Manhattan
The Queens real estate agent who sold them their home, Guyanese born Ahillia Ramotar, also known as Beatrice Sukhdeo, and the mortgage attorney, who advised them to go ahead with the purchase, have both been linked by authorities to the scandal. According to New York's daily News newspaper, Ramotar's attorney has said his client denies the allegations.
Pointer's story began one day in 1996 when she spotted a newspaper advertisement touting homes for the minuscule down payment of $2,900. She had always dreamed of owning a home, and the ad made it sound possible. She dialed the number.
The deal seemed so good that Pointer and her family ended up signing papers to purchase three Brooklyn homes from Ramotar: 1276 Jefferson Ave., 1365 Decatur St. and 164 Covert St. It was a dizzying process, Martin recalled.
According to Martin and Pointer, Ramotar would not allow them to closely examine the houses, assuring them that was "not allowed." Nor would she let them talk to the owners or tenants in depth, they said. She took their financial information, but never explained what she was doing with it. And then one day, she called to say they were approved for the loans.
Pointer said she was amazed because at the time she had been living paycheck to paycheck and several companies had turned her down for credit cards. Now she was being told she had qualified to own a home. In court papers, federal prosecutors have alleged that Ramotar got rich by fraudulently qualifying buyers for the federal 203(k) Single Family Loan program. With the government backing the mortgage bank, it wound up paying the tab when unqualified borrowers defaulted.
When Pointer of finally took control of the Covert Street house, Ramotar sent her a wicker basket filled with knick-knacks, she said.
"Everything was peaches and cream," Pointer told the Daily News. "In hindsight, we never should have been qualified for the loan."
The dream fulfilled, the nightmare now unfolded, and they had no power to stop it. Suddenly, Ramotar became ditficult to reach by phone, Martin said.
The bills appeared. The monthly cost easily outstripped the new owner's ability to pay. There were problems with the tenants. And finally, the homes themselves had structural problems, leaks and pest infestations.
At 1365 Decatur St., Buildings Department inspectors found sagging stairs that were pulling away from the wall and issued a $2,500 fine, an agency spokesman said. That fine was never paid.
"At first, it was like a dream house, but once you got into it, it was all backwards," Martin said of the Covert Street home. "Everything that was supposed to be right was all wrong. Messed up pipes, problems with the gas, a leaky rool; termite, mouse and flea infestation." As the months passed, the family fell deeper into debt. The bills, the complaints, the disputes piled up. Finally they had no choice. The mortgage banks foreclosed on the properties.
The federal government now owns the Jefferson Avenue house, real estate records show.
"At first you're so happy, you get fooled," Pointer told the Daily News. "Now I have a lifetime full of problems."
As Pointer, Martin and the others struggle to deal with the nightmare, Ramotar has remained incommunicado and could not be reached by this paper. But the federal indictment indicated that, among other things, she owns a fleet of luxury cars and two million-dollar mansions.
Another family who moved from dream to nightmare is Nigerian-born, David Isagba, a computer technician with Xerox Corporation and his wife Joyce. Isagba says last year he saw an advertisement in a main stream news publication promoting new houses for sale. The ad by Fobert Corporation, according to Isagba, touted that only $5,000 was needed as a first downpayment to buy a house.
So Isagba says he and his wife Joyce, called the number advertised and made an appointment with the office of the developer. There, they were shown pictures of several houses in several areas in Long Island. The Isagba's decided on "The Zodiac," a one-family home with two floors. They were then taken to see the house which they were told was located at 41 Cedar Lane in Middle Island, a residential area in Long Island's Suffolk County.
The house seemed like a dream come true for the Isagba's, who had lived most of their 20-odd years in the United States in an apartment in Yonkers, New York. So taking $5,000 of their hard-earned money on April 5th last year, they made a downpayment to Fobert for the $197,000 house in Middle Island. He made out check number 089108482 from his bank, First Union, to the company's attorney's, Certilman, Balin, Adler & Hyman, LLP. of East Meadow, Long Island. On the same day, David Isagba says he hired an attorney, Martin Silver, on the recommendation of Fobert executives, to oversee the transaction. He says he paid Silver $700 for that job.
Isagba says he and his wife were then referred to Full Spectrum Lending Inc., and Country Wide Home Loans, Inc., both banking institutions, where they were approved for a loan following an appraisal on May 16, 2000 by CP Appraisal, Inc., and Landsafe Appraisal Services, Inc. A mortagage of $191,000 was issued to his wife, Joyce Isagba. But Mr. Isagba says that one-week before the closing he was asked to pay another $5,000 on the home. He says he borrowed most of the money from friends and family and showed up at the closing with the check. He says on the day of the closing - August 22, 2000 - he was asked for a further $1,500. But Isagba says he told the lawyers for the bank, the seller, as well as his own lawyer, that he had no more money and had basically begged to secure the additional $5,000. Several phone calls later, he said they agreed to close the deal with a payment of $125 which he was told to make out to Sardrone Corp. Before they signed on the dotted line, the Isagba's say they were then advised that the street address of the house they had visited on Cedar Lane in Middle Island had been changed by the local post office to 80 Hawkins Avenue, Middle Island. Since their attorney had no quarrel with the deal, the Isagba's closed on the house.
"We were a first time home-buyer and depended solely on the attorney we had hired since we did not know of all of the different requirements," Isagba said.
They moved into the house on August 23, 2000 and soon enough, Mr. & Mrs. Isagba say they woke up to the startling reality that the home they had bought in the area they believed to be Middle Island was actually located in Metford. Their mail were forwarded to their old Yonkers address because the 80 Hawkins address in Middle Island, simply did not exist, according to the Post Office. A desperate Mr. Isagba began looking for answers. His phone calls he said went unreturned, although he did receive a letter from the bank on September 1, 2000, which basically advised him to begin making mortgage payments on the house at 80 Hawkins Avenue in Middle Island.
But Mr. Isagba refused to begin payment because in his words: "I wasn't going to begin payment on a phantom house." He said he began doing his own investigation and talking to his neighbors, many of whom began revealing similar situations of their own.
He filed a lawsuit against all of the parties involved in transactions. However, the case was dismissed last month by Judge John J. Dunne of the Suffolk County Supreme Court. An attorney consulted by the the Caribbean Voice to review the ruling, stated that the complaint was dismissed because neither Mr. Isagba nor his attorney showed up for the hearing.
Isagba admits he did not show up at the case and the representative he used was not a lawyer. But he still insists that his case is valid. The judge, in his ruling, stated, that the "plaintiffs complaint is grossly unclear and is comprised of incomprehensive allegations that fail to allege any cause of action against Countrywide or Martin Silver" Judge Dunn, however, stated "that plaintiffs never received a certificate of occupancy, that Countrywide failed to comply with the Truth in Lending Act and that the deed plaintiffs obtained was fraudulent."
An investigation conducted by the The Caribbean Voice also turned up inconsistencies in the deed. Asked to verify the address from the block and lot numbers recorded, three employees in the Clerk of the Suffolk County Office stated that the numbers match an address in Cedar Lane, Medford and not 80 Hawkins Avenue, Middle Island as stated on the said deed. The owner of the parcel of land and property was listed as Rod Strathen Corporation, not Fobert as stated on the deed.
Additionally, a phone listing could not be found for either Rod Strathen or Fobert anywhere in the New York area or at the address given, 290 Exeter Street in Brooklyn. A map of Middle Island also failed to show Hawkins Avenue in the area. Instead, it was found in Medford.
However, Patricia O'Keefe, of the appraisal company, CP Appraisals in Bethphage, insists that the house they appraised was located at 41 Cedar Lane/80 Hawkins in Middle Island and not Metford. She blames the confusion on the fact that the houses were part of a new development.
"It's a very complex area that's close to both Medford and Coram," said O'Keefe. "And it could easily be confused."
"It's not uncommon," she added. "We see it all the time in Bethpage, where people live in Bethpage but have another postal address."
But officials in the office of the Township of Brookhaven, where both Medford and Middle Island are located, say they have no address listed as 80 Hawkins in Middle Island but there is a 41 Hawkins Avenue in Medford. Both the Middle Island and Medford Post Offices also failed to identify the address. At the Middle Island Post Office, employees there, said that while there is no Hawkins Avenue in Middle Island, a similar location exists in Ronkonkoma.
Jim Cicione, senior counsel at Country Wide, blamed the problem on what he termed "bureaucracy" at the County level. He insisted that there was no problem from where he sat. Citing the lawsuit which was thrown out by the judge as his evidence, Cicione said that the only problem which exists is that the Isagba's have failed to make their mortgage payments as required.
Fobert's attorneys have declined to comment on the case because of the past and possible future litigation. Martin Silver, the attorney hired by the Isagba's to represent them in the purchase, did not return a call. Mr. Isagba claims Silver was hired on the recommendation of Fobert's executives.
Both he and Anubey, his spiritual counselor, are now trying to get the federal government to investigate the case. They have sent documentation supporting their complaint to the Office of the U.S. Attorney General, the Federal Bureau of Investigations, the Department of Justice, the U.S. Marshall Services, the Department of Treasury, the Department of Housing & Urban Development and the U.S. Post Master General and the U.S. Postal Inspector among others.
As thousands of home-buyers continue to be cheated by unscrupulous real estate companies, mortgage brokers and lawyers, federal and state officials are stepping in to investigate.
On June 20 New York State Attorney General Eliot Spitzer extended hope to as many as 2,500 homebuyers who might have been caught in a real life "Money Pit."
Spitzer announced a $1.5 million out-of-court settlement with First Home Brokerage of Queens for allegedly defrauding first-time homeowners into purchasing properties advertised as "totally renovated" even though they needed substantial repairs.
The settlement provides about 2,500 consumers in the Bronx, Brooklyn, Staten Island, Queens and Long Island with the opportunity for restitution and/or repairs, and requires the company to change its business practices.
Spitzer's 18-month investigation revealed that First Home told customers their properties would be inspected and approved by the Federal Housing Administration before closing. Consumers later found First Home had only made cosmetic repairs and induced inspectors to falsify reports in order to qualify the homes for FHA mortgages.
The settlement could exceed $1.5 million, depending on the number of people vicitimized and the extent of repairs needed to have the company make good on its warranties and promises, and the amount of expenses incurred by consumers who paid for repairs themselves.
Recently too the federal government declared war on predatory lenders who have victimized homeowners throughout New York City and in urban areas across the nation.
U.S. Housing and Urban Development Secretary Andrew Cuomo and Sen. Chuck Schumer (D-N.Y.) announced a multifaceted battle plan, which includes a review of more than 2,200 local FHA loans currently in default.
"We are going to put the fear of God into these scam artists who have been taking innocent homeowners and homebuyers to the cleaners," Schumer said.
More than $1.1 million in grants also will be made available for programs designed to counsel homeowners and prospective homebuyers.
Schumer said he was alerted to the problem by the Rev. A.R. Bernard of the New York Christian Life Center, who had been approached by church members who had been victimized.
In one instance, a new homeowner's building had been over-appraised by $100,000, and cracks in the walls and foundation had been covered up with sheet rock.
"How damaging is it to the human spirit to hear your loan is FHA-protected, and you have to be evicted one month after you move in because your home has been condemned as unsafe?" Bernard asked.
Cuomo called predatory lenders "modern-day pirates." He said they generally target and attack specific neighborhoods.
In response, he said, he has ordered an investigation into communities with high FHA foreclosure rates and launched a fraud prevention program targeting "Fraud Hot Zones" in five major urban cities.
HUD has declared a 90-day moratorium on all FHA foreclosures to seek evidence of inflated property appraisals and will require loans be rewritten to reflect market conditions. The agency also will step up enforcement actions against appraisers, brokers, inspectors and lenders involved in these schemes.
"If HUD finds a loan was unfair, the lender and the broker will be made to pay for it," Cuomo said. "In addition, all lenders, brokers, appraisers, lawyers and inspectors found participating in these scams will be barred from participating in the loan program and will be investigated."
Cuomo and Schumer handed out $1.1 million in grants to Neighborhood Housing Services of Brooklyn, Jamaica Housing Improvements Inc., the Cypress Hills Local Development Corp., the American Association of Retired Persons, and Association of Community Organizations for Reform Now, to provide counseling to homebuyers and homeowners.
"FHA guaranteed loans are only a small portion of the problem," Cuomo said.
He cited Mary Ward, an elderly Bedford-Stuyvesant widow who fell victim to a predatory lender without an FHA guarantee.
Ward was brought to tears as she told how she nearly lost her home.
In desperate need in 1995 for $10,000 to fight a custody battle to keep her great-granddaughter, Ward found herself seeking a loan.
After being called to three separate closings on her refinancing application, she netted, after fees, only $1,400 in cash.
Her new $14.9% mortgage increased her monthly mortgage payment to almost $1,400 from the $460 a month she had been paying.
She has a lawsuit against the lending company that is pending.
Meanwhile potential home buyers are advised that trust should never play a part in any transaction. Instead make sure that a financial analysis is done to ensure that monthly payments can be afforded. And it is advisable to get two or more such analysis done by different analysts. Also do not use mortgage brokers or lawyers recommended by the real estate company or salesman. Usually such brokers and lawyers work hand in glove with the salesman/company. Make sure that the property is inspected by an engineer. And again do not use an engineer recommended by any one of the parties involved in the transaction.
Always verify that the property is located at the address listed and it is owned by the name listed- these can be easily verified by a good lawyer. Perhaps too it would be good to get an independent appraisal of the property. Do not be taken in by smooth talking sales persons, even if they are friends and/or belong to your community/nationality. And do not give in to pressure tactics in the hurry to become a home owner. Rather seek out others who have done business with the real estate companies, mortgage brokers and lawyers and find out about the kind of service that was delivered.
Going through the above procedures would take time and may involved a few extra dollars. But it could save a potential homebuyer thousands of dollars, extensive and expensive legal procedures and huge repair bills among other headaches.

HUD Foreclosures as High as 10% of FHA Loans
The United States Department of Housing and Urban Development (HUD) oversees the Federal Housing Administration (FHA), which provides federal insurance on home mortgages. The FHA's mortgage guarantee program, founded during the Depression to jump-start the housing industry, encourages lenders to offer loans with low down payments and longer terms to buyers who would not qualify for a conventional mortgage.
If a homeowner fails to make payments on a FHA loan, the mortgagee forecloses and files an insurance claim with HUD. In exchange for paying off the unpaid loan balance to the mortgagee, HUD receives title to the property. At this point, the
house becomes a HUD home.
After the mortgagee conveys the property to HUD, the Management and Marketing Contractor (M&M Contractor) begins the process of managing and marketing the homes according to HUD guidelines. The M&M Contractor is First Preston Foreclosure Specialists or Southeast Alliance of Foreclosure Specialists, depending upon the state or territory where the property is located.
Indeed foreclosures seem to be the order of the day as homeowners in New York are defaulting on Federal Housing Administration-backed mortgages at a higher rate than anywhere in the country. And housing experts are blaming predatory lenders and a slowing economy.
A recent report in Crain's New York Business magazine notes a 30% increase in the city's 90-day default rate on mortgages guaranteed by the feds.
In New York, more than 5,100 FHA-secured loans - or 10.08% of all FHA loans awarded - were overdue by at least 90 days between March 2000 and March 2001.
Greedy lenders, who scam low-income borrowers by charging excessive fees, inflating appraisals and providing misleading information about the properties, are largely to blame for the increase, according to Crain's.
The report follows disclosures that crooked lenders, targeting people in Brooklyn and Harlem, cannibalized the federal 203(k) program, which backs loans for low- and middle-income families to buy and rehabilitate small buildings and brownstones.
"If these FHA default rates get too high, and we continue to see a large number of delinquencies, that's a serious problem," Lisa Donner, coordinator for the anti-predatory lending campaign in the Brooklyn office of ACORN, a housing advocacy group, told Crain's.
Housing experts also warned that defaults are likely to rise as the economy continues to slow.
New York is not the only city seeing significant FHA mortgage defaults. Nationally, the rate of FHA mortgages in default for at least 30 days broke 10% for the first time ever during the fourth quarter of 2000.