GMAC Relents on Widow’s Foreclosure

That’s good news for Alice Bruner of Oil City, who received the letter just a few hours before MortgageDaily.com called to talk to her about the status of her home improvement loan.

“The whole thing was just a disaster,” said Bruner of her complex case that is part of an investigation headed by the Pennsylvania Attorney General office.

According to Patrick Hernan, who reports for The Derrick and has followed Bruner’s case closely, the state probe began in May 2001 and includes the claims of more than 225 area residents who say they were defrauded in home improvement or brokerage deals. The state has named more than a dozen defendants, reported Hernan.

The state office did not return calls by MortgageDaily.com.

Had her debt — which she estimated at $22,000 — not been forgiven, Bruner said she would have had to pay about $130,000 over the 30-year term of the loan. She said the original loan amount was $23,000, and was based on a $38,000 appraisal — 300% higher than Venango County had valued the home months earlier.

According to Bruner, the deal was arranged by a home improvement contractor, and was signed and dated Oct. 1, 2000 — a day after her husband passed away.

“No way did I ever put my signature on that paper,” said Bruner. “The only thing I did that day was went with my family and make arrangements at the funeral home.”

It all began when the contractor stopped by Bruner’s aging home shortly after she and her husband had purchased the place, she said. The contractor came at an appropriate time since she really wanted a new front porch roof and a fence, plus half of the roof needed to be repaired.

Bruner said the roof was “repaired” and three doors were installed in November 2000.

Not long after, the roof started leaking and the contractor allegedly took back his word that it had a 25-year warranty. Although he told Bruner’s son that someone would be sent to fix the problem, no one ever came, she said. After contacting the Pennsylvania code enforcement officer, it was found that the home improvement workers had not replaced the roof’s “rotten” boards and had just placed new shingles on them, said Bruner.

Additionally, Bruner said she was led to believe the loan would include all the work she wanted done; but the contractors expected her to take out another loan for her fence and porch roof.

In the midst of all this, now defunct EquiCredit Corp. of America, which originated the loan, persistently called Bruner asking her to sign papers that were sent to her so the contractor could receive his escrow money, she said.

“They harassed me so much I finally did sign the papers” even though the work was not completed or properly done, said Bruner.

About a year after EquiCredit handled the loan, Fairbanks Capital Corp. acquired it. The Salt Lake City-based company, which last year entered into a $40 million settlement with the government over its servicing practices, would constantly call Bruner with threats of foreclosure on her home — despite that her loan was being investigated by the state, she said. The calls stopped after the Attorney General’s office sent a “very effective” letter to Fairbanks, she added.

However, Bruner’s peace was broken when the loan was transferred to GMAC last September, said Bruner. The company had raised her monthly payments and asked her to pay over $6,000 upfront to make the loan current and avoid foreclosure, according to Bruner.

Bruner said she contacted Hernan to inform him about the situation and meanwhile sent GMAC a number of published articles he had written, in an effort to explain that the loan was not a legitimate deal.

“Apparently, [GMAC] were the only ones that listened and did some checking of their own,” said the widow. “They came through for us.”

Why GMAC decided to forgive the loan is unclear. A spokeswoman said she was not told the reason, but that the FedEx-Ed letter they sent Bruner probably had an explanation.

However, the letter did not disclose this information, according to Bruner, who in an excited voice read the document’s words that put an end to her “disaster” story — “GMAC has elected to forgive the debt owed in the mortgage securing the home… the release of the mortgage was sent to the county Feb. 10, 2004 and recorded the same day.”

GMAC started investigating Bruner’s claim after The Derrick contacted it inquiring why her home was being threatened of foreclosure when her case was under investigation by the state, according to The Derrick reporter Hernan.

“I cannot say anything good enough to point out what Pat Hernan has done for us,” said Bruner. “I don’t think any of this would have happened if he wasn’t involved.”