This Fair Haven foreclosure had a happy ending. Sort of.
When Max Malmquist, the owner of this 107-year-old house at 210 Front St. in Fair Haven, noticed a For Sale sign two weeks ago in front of his house, his first impulse was to go out and rip it down. And he acted on that impulse.
It never was planted again, even though a foreclosure sale on the place he loves and has live at for four years was advertised for three days last week in the Register. Not even the lawyer knew it was called off until Friday afternoon, less than 24 hours before the Saturday sale.
But Malmquist (who asked not to be photographed for this story) knew.
“It was jut a big bureaucratic … screw-up,” he said, as his new nine-week old pug puppy frolicked on the open green lot adjacent to his house.
The record, along with a sidewalk interview with Malmquist, disclosed the following: He purchased the house in 2004 for $134,900, which he financed with a mortgage in the amount of $107,920 from an outfit called New Century Mortgage, location unknown.
Within a week, the loan was reassigned to Deutsche Bank (which is responsible for an estimated 12 percent of all foreclosure actions in New Haven). Then three months later, in October 2004, the bank was being represented under “a pooling and servicing agreement,” by Litton Loan Servicing company, essentially a debt collection firm for Deutsche Bank, located in Houston, Texas.
Flip the pages of the calendar three years to summer 2007, and a foreclosure action is taken against Malmquist for delinquency of his monthly mortgage payment. His debt had risen, with interest, to $117,000. The value of the house had also risen, appraised in March, 2007, at $165,000.
At the end of October he requested a stay for reasons of bankruptcy, which appears to have been honored. But the foreclosure process were reopened in January of this year, with a debt having risen to $121,000.
Obviously it was difficult for the payments to be made. Malmquist, who said he runs a stone mason business, also admitted that he had some peculiarities. He didn’t believe in using banks, for example, and he made all his payments in cash, which he wired to the debt collection agent. In January, he said, he missed a payment.
However, he sought to head off the problem. “In February of this year,” he explained, “I called Litton about restructuring, and, you know, they were very good. They helped. They lowered the interest rate from 8.3 percent to 7 percent, which meant a monthly payment reduced from $1,600 to about $1,100. That was doable, and I made the initial payment in April.”
But it’s pretty clear that Litton didn’t call the lawyers to call off the foreclosure proceedings. “I mean,” said Malmquist, as he greeted several neighbors who were, like him, out walking their dogs by the lovely Quinnipiac River, “the left hand didn’t know what the right was doing.
“On Monday of this week, literally I was on the phone to the Litton people in Houston for four hours. Being passed from the Restructuring Department to the Negotiating Department to the Loss Mitigation Department. One woman was really helpful, and she said, yes, ‘Your restructuring agreement is right here on record.’
“‘Will someone then, please call off the lawyers!’”
Finally, on Friday, the day before the foreclosure sale, which had been announced in the newspaper, Malmquist received an official letter saying the foreclosure was called off. “Legally or something,” he said, “they have to reopen the foreclosure in order to close it.”
The lawyer appointed by the court to oversee the sale, Norman Fishbein of Wallingford, had already deposited in the case’s file at Superior Court these expenses: Reg ad: $402; sign: $257; liability insurance $310; appraisal, $300 for a total of $1,269. In addition, lawyer’s fees at $200 per hour, for 5.5. hours, for a total of $1,100.
Now who’s going to pay those costs, without a foreclosure?
It was not Malmquist’s problem — at least not yet … or unless there’s another miscommunication. For now, Malmquist and his dog were enjoying their walk along the river in Fair Haven.
Please click here for a related story, about a Saturday foreclosure sale in Fair Haven.
Previous Independent coverage of New Haven’s foreclosure crisis:
• Rescue Squad Swings Into Action
• A Bidder Shows Up
‚Ä¢ Bank Beats Tanya’s Bid
• Westville Auction Draws A Crowd
• DeStefano: Foreclosure Plan Ready
• Can They Help?
‚Ä¢ “We Should Over-Regulate These Bastards”
• Rosa Hears of Rescues
• WPCA Grilled on Foreclosures
‚Ä¢ WPCA’s Targets Struggle To Dig Out
• Sue The Subprimers?
• WPCA Hearing Delayed
‚Ä¢ Megna’s “Blood Boils” at WPCA Tactics
• Goldfield Wants WPCA Answers
• 2 Days, 8 Foreclosure Suits
• WPCA Goes On Foreclosure Binge
• A Guru Weighs In
• WPCA Targets Church
• Subprime Mess Targeted
‚Ä¢ Renters Caught In Foreclosure King’s Fall
‚Ä¢ She’s One Of 1,150 In The Foreclosure Mill
‚Ä¢ Foreclosures Threaten Perrotti’s Empire
‚Ä¢“I’m Not Going To Lay Down And Let Them Take My House”
The following links are to various materials and brochures designed to help homeowners avoid foreclosure.
How to prepare a complaint to the Department of Banking; Department of Banking Online Assistance Form; Connecticut Department of Banking, Avoiding Foreclosure; FDIC Consumer News; Statewide Legal Services of Connecticut, Inc; Connecticut Bar Association Lawyer Referral Service.
For lawyer referral services in New Haven, call 562-5750 or visit this website. For the Department of Social Services (DSS) Eviction Foreclosure Prevention Program (EFPP), call 211 to see which community-based organization in the state serves your town.
Click here for information on foreclosure prevention efforts from Empower New Haven.