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Mortgage Lender Takes $500k Hit Over Language Issues

Mortgage Lender Takes $500k Hit Over Language Issues

Oregon jury finds in favor of Spanish speaking couple against Beneficial

February 4, 2004

By PATRICK CROWLEY


Panfilo Vasquez-Lopez and Maria Dominguez came from Mexico to Oregon in the 1980s looking for a piece of the American dream. And for the most part, they thought they had found it.Though each earn less than $8 dollars an hour — he paints houses, she works on a factory assembly line — and neither speak English, they saved for years and bought a home in northeast Portland in 1999.

In 2000, at the height of a refinancing wave, they were approached by a Spanish-speaking sales associate from Beneficial Mortgage Corp. after receiving loan solicitations in the mail. He reportedly offered a second mortgage at 7.8 percent.

Needing repairs on the their roof the couple took out the second mortgage. The payments were to include property taxes and insurance.

But when they unexpectedly received a delinquent tax bill they discovered the interest rate on their loan was nearly 13 percent.

So they went to court. And they won.

A Multnomah County jury voted 11-1 to award the couple $545,000 in damages after finding they were defrauded by signing loan documents they could not read.

“Our allegation,” the couple’s Portland lawyer, Phil Goldsmith, said in an interview,” is that they were taken advantage of. And that’s what the jury found.”

Beneficial could not be reached to comment and Goldsmith said the company may appeal the verdict.

The jury awarded Vasquez-Lopez, 54, and Dominguez, 52, $500,000 in punitive damages and $45,000 in economic and other damages, including emotional distress.

According to the lawsuit, the couple did not know about the terms of the mortgage until receiving a notice from the county assessor’s office that their property taxes had not been paid.

The couple contacted a relative who speaks English, who in turn contacted Beneficial.

The company told the relative that Beneficial was not responsible for paying the taxes, and that the couple should “read their paperwork,” according to the lawsuit.

But the paperwork was printed in English.

The lawsuit alleges that the Beneficial employee “knew that (the couple) could not read English and therefore would not understand the written disclosures given to them in English Beneficial.”

“Plaintiffs would not have entered into the consolidated loans with Beneficial” if they had understood the terms of the loan, according to the lawsuit.

The refinanced loan would have cost the couple an additional $140,000 over what they thought they were borrowing at the lower interest rate.

Goldsmith said while most loan disputes are settled by an arbitrator this case landed in court because a judge ruled out arbitration as a way to settle the dispute because of the language barrier.

The episode has not soured the couple on living in America.

“I have much in God and the United States because they opened their doors to me and allow me to work,” Dominguez told The Portland Oregonian through an English-speaking relative.


Patrick Crowley is a political reporter and columnist and former business writer for The Cincinnati Enquirer. Email Patrick at: pcrowley@enquirer.com

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