Single mother caught in mortgage nightmare

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by Craig Cheatham / News 4 Investigates

KMOV.com

Posted on May 23, 2012 at 9:09 PM

Updated Thursday, May 24 at 3:37 PM

MADISON COUNTY, Illinois (News 4 Investigates) -- A Madison County woman is in a mortgage nightmare. She's fighting to stay in her home and raise her handicapped daughter while a massive bank pushes to foreclose on the home.

Marsha Schmidt grew up in her Roxana, Illinois home, and helped rebuild it so that it was wheelchair accessible for her handicapped daughter.

Seven years ago, Ms. Schmidt became a co-owner of the home. But when her father died, the mortgage was still in his name. That wasn't a problem until her daughter went back in the hospital and Ms. Schmidt fell behind on the mortgage payments.

She asked if she could modify the mortgage, and insists Wells Fargo encouraged her to stop making payments on her loan. She says the company even returned her $804 mortgage payment. Eventually, the late amount was too big for her to pay off. Now she risks losing the house, and Wells Fargo appears to be scrambling to fix a situation that clearly shouldn't have reached this point.

The non-profit group Beyond Housing is advocating for Ms. Schmidt and is optimistic it can help her stay in her home. Beyond Housing has assisted thousands of people for free. You can learn more about their services by going to the Beyond Housing links.

Yesterday, Wells Fargo reassured investors that it's less risky than other major banks. Recently, Wells Fargo reported record quarterly profits.

In a statement, Wells Fargo told me "Wells Fargo views foreclosure as a last resort and will do what we can to avoid it in this case, but we can’t guarantee that we will be able to work through all of the issues. This is a complicated situation resulting from the status of her father’s estate and involves a number of issues that are beyond our control.  These issues have limited our ability to assist Ms. Schmidt and continue to present challenges. 

We will need to determine if the investor in the loan, Freddie Mac, will allow for an assumption of the mortgage and if Ms. Schmidt qualifies for an assumption.  We also need to assess whether a modification of the loan or another option is available that will allow Ms. Schmidt to remain in the home.

 

There is no foreclosure sale scheduled and Wells Fargo continues to work with Ms. Schmidt to determine if there are any options that would allow her to stay in the home.  We will be happy to work with her and with Beyond Housing in an effort to find some way for her to retain the home if that is possible.  If she can obtain the funds to bring the loan current, that could help with some aspects of the process and she should discuss this option with our representative."

Following a series of phone calls between Wells Fargo, Ms. Schmidt and me, it was clear that Ms. Schmidt believes Wells Fargo has no intention of forcing her out of her home, but we will have to wait and see.

 

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