They file suit to stop auction of their West Bloomfield home
Thursday, December 20, 2007
Mike Martindale / The Detroit News
PONTIAC -- An Oakland County Circuit judge is to decide today whether to stop a mortgage lender from foreclosing on a West Bloomfield Township couple and allowing their home to be sold at a sheriff's auction.
Sheryl and Jeffrey Fox were slated for a sheriff's sale Dec. 10 but obtained a temporary restraining order against Homecomings Financial, a Dallas-based lender being sued along with GMAC and The Bank of New York Trust Co. under the Michigan Consumer Protection Act.
In a lawsuit before Oakland Circuit Judge Nanci Grant, the Foxes allege that despite their efforts, they were not permitted to restructure their adjustable rate mortgage and make affordable payments. The Foxes seek a preliminary injunction against foreclosure or sale until the lawsuit is resolved.
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"If Shakespeare was alive today, he wouldn't write how 'First we kill all the lawyers,' " said attorney Marilyn Kohn, representing the Foxes. "He'd say: 'First we kill all the subprime lenders.' "
The Detroit News has reported how the troubled economy has hit especially hard in Metro Detroit, where more than 70,000 homes have been subject to foreclosure filings since January 2006. The legal challenge comes as several ambitious plans have been unveiled to help people facing foreclosure, including restructuring debts and rolling back interest rates.
Former Federal Reserve Chairman Alan Greenspan has said direct government assistance should be provided to homeowners facing foreclosure.
Among proposed new regulations to take effect after a 90-day period, in which the public can comment, is a requirement that lenders qualify adjustable mortgages at both the lowest and the highest possible interest rates. That would eliminate borrowers being approved strictly on introductory "low" rates only to see them later spike out of reach.
Kohn told Grant how the Foxes obtained their mortgage in 2003 and saw payments go from less than $1,400 a month to more than $2,600 a month. They could not keep pace, tried to restructure the loan and haven't made any payments since June.
Kohn said risks of losing the three-bedroom ranch were never disclosed. She said her law firm has attempted since April to restructure the loan -- which jumped from 7.5 percent to 12.6 percent within the past year -- and even submitted financial records requested by Homecomings. Instead of a new contract, they received a foreclosure notice last month.
GMAC attorney Stephen King countered that "everything" was in the couple's agreement and said the lenders are being demonized.
Thursday, December 20, 2007
Mike Martindale / The Detroit News
PONTIAC -- An Oakland County Circuit judge is to decide today whether to stop a mortgage lender from foreclosing on a West Bloomfield Township couple and allowing their home to be sold at a sheriff's auction.
Sheryl and Jeffrey Fox were slated for a sheriff's sale Dec. 10 but obtained a temporary restraining order against Homecomings Financial, a Dallas-based lender being sued along with GMAC and The Bank of New York Trust Co. under the Michigan Consumer Protection Act.
In a lawsuit before Oakland Circuit Judge Nanci Grant, the Foxes allege that despite their efforts, they were not permitted to restructure their adjustable rate mortgage and make affordable payments. The Foxes seek a preliminary injunction against foreclosure or sale until the lawsuit is resolved.
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"If Shakespeare was alive today, he wouldn't write how 'First we kill all the lawyers,' " said attorney Marilyn Kohn, representing the Foxes. "He'd say: 'First we kill all the subprime lenders.' "
The Detroit News has reported how the troubled economy has hit especially hard in Metro Detroit, where more than 70,000 homes have been subject to foreclosure filings since January 2006. The legal challenge comes as several ambitious plans have been unveiled to help people facing foreclosure, including restructuring debts and rolling back interest rates.
Former Federal Reserve Chairman Alan Greenspan has said direct government assistance should be provided to homeowners facing foreclosure.
Among proposed new regulations to take effect after a 90-day period, in which the public can comment, is a requirement that lenders qualify adjustable mortgages at both the lowest and the highest possible interest rates. That would eliminate borrowers being approved strictly on introductory "low" rates only to see them later spike out of reach.
Kohn told Grant how the Foxes obtained their mortgage in 2003 and saw payments go from less than $1,400 a month to more than $2,600 a month. They could not keep pace, tried to restructure the loan and haven't made any payments since June.
Kohn said risks of losing the three-bedroom ranch were never disclosed. She said her law firm has attempted since April to restructure the loan -- which jumped from 7.5 percent to 12.6 percent within the past year -- and even submitted financial records requested by Homecomings. Instead of a new contract, they received a foreclosure notice last month.
GMAC attorney Stephen King countered that "everything" was in the couple's agreement and said the lenders are being demonized.
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