American Horror Story: Paying Your Mortgage and Still Being Foreclosed

“I never thought it would ever be possible to face the loss of my home to foreclosure when I made my mortgage payments as required each month but that’s exactly what has happened. If it can happen to me, it can happen to anyone.”

Florida homeowner Henry Manfrediz is upset, and he has every reason to be. Far from being over, the mortgage crisis and sloppy record keeping on behalf of big banks and mortgage servicers is creating exactly this scenario for untold numbers of homeowners. He and his wife Elizabeth had no way to know that when they took out a mortgage with JP Morgan Chase that they’d be caught in a chain of events that would bring them to foreclosure without ever having missed or even been late with a single payment.

You see, JP Morgan Chase transferred the loan to Fannie Mae (FNMA), as most lenders do. The FNMA was founded in the Great Depression as a government-sponsored enterprise that would turn mortgages generated by local banks into securities, freeing the banks to reinvest their assets into generating more mortgages to lower and middle income people. Mortgage backed securities have been around a long time, and until recently were considered a trustworthy investment. Where the real nightmare starts is with the servicers starting with JP Morgan Chase and Fannie Mae, who appear to have completely – there’s no polite way to say it – messed up.

How It Began

At the start, JP Morgan Chase serviced the loan taken out in 2008, who in 2010 informed the Manfredizes that they owed $4,000 more for an insurance policy on the property that, frankly, was completely contraindicated. The Manfrediz family had made a large down payment of 20 percent, nullifying the lender’s requirement of mandatory escrow. The taxes and insurance were paid in a timely manner, with no lapse in good standing or coverage. The loan and the expensive, unnecessary policy forced on the homeowners was then transferred to Fannie Mae and their servicer, a company called Seterus.

Since taking over the servicing of the mortgage, Seterus has consistently refused the Manfredizes’ payments, admitting they received the payments, and admitting that they have had problems like this before. However, the servicer refused to negotiate or make the errors right. They are even reporting the mortgage as delinquent to the credit bureaus, causing hardship and stopping them from refinancing their properties. The Manfrediz family have contacted Seterus, making phone calls and sending letters trying to get the servicer to fix the mistake that’s causing so much grief.

Doing Everything Right, to No Avail

“It’s very frustrating to have UPS make daily stops at your house (including Christmas Eve!) for over a year, delivering default letters, demand letters, and other foreclosure documents. The neighbors all want to know what’s going on.” Mr. Manfrediz says. “The kids know what’s going on and are scared of the uncertainty. Every Realtor, property investor, and foreclosure specialist in the county has contacted us by phone, mail, or knocked on the door. I would have refinanced a long time ago if they hadn’t marked up my credit from the beginning and trapped me in this loan. Our finances are in disarray. We do not deserve to be in this situation.”

There was no movement, despite the Manfredizes’ clearly establishing a paper trail documenting their good faith efforts to pay their mortgage and contact Seterus about their mistakes. However, nothing happened until they retained Chad Van Horn of the Van Horn Law group.

“Thankfully Mr. Van Horn and the Van Horn Law Group have been fighting hard for us. I teach my kids to always do the right thing, and I think that’s what Chad is doing for us. He and his team have been great and we’re hopeful this will be rightfully resolved,” Mr. Manfrediz said.

Hope for the Future

The Manfredizes are only looking to be made whole as the law allows. They want their mortgage payments acknowledged and the credit report corrected, and to have their legal fees reimbursed, which is entirely reasonable considering what they’ve been through for the past five years.

Attorney Chad Van Horn said, “People face injustice every day but this case is especially egregious since this well organized and intelligent couple has tried to do everything in their power to get their mortgage servicer to properly account for the mortgage payments they’ve sent for years. Instead the mortgage payments were refused and the couple faced the loss of their home. My firm and I are proud to help Henry and Elizabeth and other couples facing these type of situations to get their mortgage companies to correct the mistakes they’ve made.”

After Attorney Van Horn became involved, Fannie Mae dropped their efforts to foreclose. Counterclaims by the Manfrediz family for damages incurred in fighting the wrongful actions are still pending.


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About Chad Van Horn

Chad T. Van Horn, Esq. is a South Florida business leader and founding partner attorney of Van Horn Law Group, P.A. Through a combination of dedicated philanthropy, spirited entrepreneurship and legal expertise, he applies his resources and network to helping people. Learn more about Chad Van Horn

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