Judge Erases $525G Mortgage for N.Y. Couple, Citing 'Repulsive' Acts by Bank

[Joyful HoneyBee]

IMHO here is a judge we can be proud of, and I hope this sets a powerful precedent for other judgments against the myriad of predatory mortgage lenders who have taken bailout money, yet continue to terrorize struggling homeowners. :clap:


A Long Island couple is home free after an outraged judge gave them an amazing Thanksgiving present — canceling their debt to ruthless bankers trying to toss them out on the street.

Suffolk Judge Jeffrey Spinner wiped out $525,000 in mortgage payments demanded by a California bank, blasting its "harsh, repugnant, shocking and repulsive" acts, the New York Post reported.

The bombshell decision leaves Diane Yano-Horoski and her husband, Greg Horoski, owing absolutely no money on their ranch house in East Patchogue.

Spinner pulled no punches as he smacked down the bankers at OneWest — who took an $814.2 million federal bailout but have a record of coldbloodedly foreclosing on any homeowner owing money.

"The bank was so intransigent that he [the judge] decided to punish them," Greg Horoski, 55, said about Spinner's scathing ruling last Thursday against OneWest and its IndyMac mortgage division.

It erased up to $291,000 in principal and $235,000 in interest and penalties.

The Horoskis — who had been paying only interest on their mortgage — had no equity in the home.

Horoski, who had begged the bankers to let him restructure the loan, said, "I think the judge felt it was almost a personal vendetta." Dealing with the bank, he said, was "like dealing with organized crime."

OneWest said, "We respectfully disagree with the lower court's unprecedented ruling and we expect that it will be overturned on appeal."

It claimed it "has been extremely active in working with consumers on home loan modifications through the Obama administration's Home Affordable Modification Program and other loan modification initiatives."

The bank is owned by a private equity group that purchased the failed IndyMac bank.

Yano-Horoski, a college professor of English and cognitive reason, and Horoski, who sells collectible dolls online, bought their 3,400-square-foot, one-level house 15 years ago for less than $200,000.

In 2004, court records show, they refinanced, paying off their original mortgage with part of a $292,500 sub-prime loan from Deutsche Bank. They used what was left for health care and for his business.

The loan carried an initial adjustable interest rate of 10.375 percent, which soared to 12.375 percent.

It eventually ended up being either owned or serviced by IndyMac, and the bank sued the couple in July 2005 when they began having trouble making payments because of Horoski's health problems.

After a foreclosure was approved last January, Yano-Haroski successfully asked for a court settlement conference.

Spinner excoriated OneWest for repeatedly refusing to work out a deal, for misleading him about the dollar amounts at stake in the case, and for its treatment of the couple over months of hearings.

OneWest's conduct was "inequitable, unconscionable, vexatious and opprobrious," Spinner wrote.

He canceled the debt because the bank "must be appropriately sanctioned so as to deter it from imposing further mortifying abuse against [the couple]."

The bank is involved in a similar case in California, where it's trying to foreclose on an 89-year-old woman, despite two court orders telling it to stop.

[cat slave]

I have sympathy for anyone struggling to save their home...BUT, people have
to take responsibility for their actions.

Yes, there are predatory lenders but they are not grabbing people off the street
and forcing them to sign contracts. Another social experiment gone way bad..
CRA....owning a home is a right? No. Some people have no business with
a home and all the upkeep it requires. Some people make other choices.

What ever happened to actually having a job, a credit history (a decent one)
and making a downpayment....then following up all that with paying mortgage
every month till its paid for?

What part of "adjustable" is not understood? Did anyone seriously think their
payment would go down???? Guess so. Yet another Freddie and Fannie
c*****r f**k compliments of the government and paid for by taxpayers...
over and over and over.

The only people I feel sorry for are the ones who have had their jobs
outsourced or permanently downsized, again thanks to the poor management
of the WH and the bought and paid for congress.

[bullypulpit]

I have sympathy for anyone struggling to save their home...BUT, people have
to take responsibility for their actions.

Yes, there are predatory lenders but they are not grabbing people off the street
and forcing them to sign contracts. Another social experiment gone way bad..
CRA....owning a home is a right? No. Some people have no business with
a home and all the upkeep it requires. Some people make other choices.

What ever happened to actually having a job, a credit history (a decent one)
and making a downpayment....then following up all that with paying mortgage
every month till its paid for?

What part of "adjustable" is not understood? Did anyone seriously think their
payment would go down???? Guess so. Yet another Freddie and Fannie
c*****r f**k compliments of the government and paid for by taxpayers...
over and over and over.

The only people I feel sorry for are the ones who have had their jobs
outsourced or permanently downsized, again thanks to the poor management
of the WH and the bought and paid for congress.

You DO realize that some 60% of ALL bankruptcies are the result of medical expenses, right? The couple ran into difficulty with their payments as a direct result of MEDICAL EXPENSES. The couple was making their payments until medical bills overwhelmed them.

That being said, NO ONE should have a mortgage payment, interest included, that is more than 25% of their monthly net income. NO ONE should refinance solely to pay off credit card debt. NO ONE should be in an interest only mortgage unless they're not going to be living in a house for more than a couple of years. NO ONE should take a variable interest rate mortgage.

[cat slave]

Yes, Im aware of the bankruptcy component of that particular story and yes,
the bank acted real tacky and that is one isolated case that doesnt fall
under the Freddie and Fannie debacle. Im sure there are similar cases yet
for the most part it is people signing their John Henry on documents that
they have no clue about actually reading...kind of like congress does!

I also wondered about that 89 year old lady.....why would a very senior
citizen even have a mortgage? Wheres her family? Why does she have
no assets and has plunged into debt at her age? I dont get it. If you
jump the river you may drown, at the very least youre gonna be soaked.

But then, since it was suggested strongly that home ownership was a "right"
too many people believed it.

Id hate to see situations like the medical bankruptcy start a trend of judges
just willy nilly tossing out any responsibility of bill payments.

And whats this "credit" help stuff I see on tv???? Again, irresponsible
people need help? I call it enabling. We paid for our homes, our bills,
put our grandson through college, saved $$ (which who knows if it will
be worth diddly squat, really soon), we carry insurance/protection payments
for everything imaginable and who knows if we are safe? Its up for grabs
with this Marxist in the WH, after the wandering GW and the out of control
congress. Who knows anymore.

Yes, the bank was heartless and uncooperative and unwilling to work with
those people but again, I worry about the precedence it sets of interference
from the bench.

[-Cp]

Have a link?

[Missileman]

IMHO here is a judge we can be proud of, and I hope this sets a powerful precedent for other judgments against the myriad of predatory mortgage lenders who have taken bailout money, yet continue to terrorize struggling homeowners. :clap:

I think you're aiming at the wrong entity. The judge should be throwing the book at the SoBs who dragged those poor people into the lender's office and made them sign the paperwork at gunpoint.

[Joyful HoneyBee]

Have a link?

oops, forgot to post the link......
http://www.foxnews.com/story/0,2933,577105,00.html

[Kathianne]

You DO realize that some 60% of ALL bankruptcies are the result of medical expenses, right? The couple ran into difficulty with their payments as a direct result of MEDICAL EXPENSES. The couple was making their payments until medical bills overwhelmed them.

That being said, NO ONE should have a mortgage payment, interest included, that is more than 25% of their monthly net income. NO ONE should refinance solely to pay off credit card debt. NO ONE should be in an interest only mortgage unless they're not going to be living in a house for more than a couple of years. NO ONE should take a variable interest rate mortgage.

So, anyone who defaults for medical care, we should give a house to? Or just those that have a house, then get sick and cannot pay it? What about job loss? Free house?

[emmett]

I have an idea. Let's let the government control everything! When we grow up and leave home we get assigned an apartment to live in while we go to school. They can keep up with our finances for us and just issue us vouchers for things like food and medical care. We won't have to worry about taxes that way or other inconveneiences like bank accounts and stuff.

Clothes could be issued. Trucks could come around and distribute food to everyone or we could just ride our bicycles to the local distribution center.

I think if we did this it would eliminate all the "what I'm entitled to" and "what you're entitled to" crap, we could all just be equal. I think everyone would still go to work...cause if you didn't, well.........

I also trust our government that they would use our resources wisely. I mean these are the folks that have risen to the top of society, you guys don;t think they would screw us do you? Just look how well Education, the iRS, Medicaid, Medicare and last but not least our truly precious social program......Social Security has worked out.

[red states rule]

You DO realize that some 60% of ALL bankruptcies are the result of medical expenses, right? The couple ran into difficulty with their payments as a direct result of MEDICAL EXPENSES. The couple was making their payments until medical bills overwhelmed them.

That being said, NO ONE should have a mortgage payment, interest included, that is more than 25% of their monthly net income. NO ONE should refinance solely to pay off credit card debt. NO ONE should be in an interest only mortgage unless they're not going to be living in a house for more than a couple of years. NO ONE should take a variable interest rate mortgage.

and do you realize more then half of all the loan modifications previously done, are back in default?

All the billions of taxpayer mainy being spent by Dems to keep these people in homes are being flushed down the drain

So what if they lose the house - they become renters

Renters is what they should have been in the first place

If Judhes can walk in, toss out contract law, and tell investors and banks they will not be paid - there will be even less crdit available and few people wil get home loans as well as other forms of credit

[Agnapostate]

If Judhes can walk in, toss out contract law, and tell investors and banks they will not be paid - there will be even less crdit available and few people wil get home loans as well as other forms of credit

Is that who you think controls financial institutions? ;)

Bad typo there! :lol:

[Joyful HoneyBee]

The tough part to digest, and the reason cited for the judge's response was the brutal way the lender treated the couple. Lenders can become very abusive, and obviously that was the point of the judgement....to deter other lenders from being vicious and abusive
Spinner excoriated OneWest for repeatedly refusing to work out a deal, for misleading him about the dollar amounts at stake in the case, and for its treatment of the couple over months of hearings.

OneWest's conduct was "inequitable, unconscionable, vexatious and opprobrious," Spinner wrote.

He canceled the debt because the bank "must be appropriately sanctioned so as to deter it from imposing further mortifying abuse against [the couple]."

The bank is involved in a similar case in California, where it's trying to foreclose on an 89-year-old woman, despite two court orders telling it to stop.

In the late 90's and early 2000's you couldn't open a magazine or newspaper without being smacked in the face with offers to refinance, loans of up to 125% of your home's value. I remember thinking then that a lot of people would get into trouble with such loans. Then, in so many communities the property values were bumped up to ridiculous appraisals/assessments, so people started to believe their property had actually appreciated that much. Again, I was appalled, knowing that property values don't skyrocket the way they did.

The whole charade was a shell game being played out by big money moguls and wall street crooks. When firms like Moody's Ratings, Fitch Ratings and Standard & Poore's started waving their sorcerer's wands over those CDO's and declaring that B rated properties could magically become AAA investments just by packaging them into bundles, well, that was the proverbial straw that broke the camels back.

Blame is plentiful and must be shared equally among all the players. Yes, people were stupid to saddle themselves with more house than they could afford. Realtor's were more than happy to take their commissions on those inflated sales, mortgage lenders were pushing to keep up with Fannie and Freddie-all the while realizing they were blowing hot air into a bubble, and then the ones who were supposed to man the checks and balances (rating agencies) failed miserably when they let dollar signs hypnotize them into LYING about the values of those CDO's. Everyone screwed up, truly...so as far as I can tell, an abusive predatory lender or two can bear a wrist slap now and then. I still commend the judge for punishing them for their abusive practices...that was the whole point, after all. It wasn't that the couple deserved a free house, it was that they deserved to be treated with dignity.

[Missileman]

It wasn't that the couple deserved a free house, it was that they deserved to be treated with dignity.

Then the judge should have ruled for the mortgage company to restructure the loan to reasonable terms. Gifting the couple over $500 million was an unreasonable decision and if upheld, will ultimately be paid by the rest of us.

[Joyful HoneyBee]

That would probably be the most reasonable assumption, based on the information on the surface, but, we don't know what other information the judge had at his disposal.

Perhaps he had documentation demonstrating that the couple had been harassed enough to warrant a large settlement on their behalf. Perhaps his goal was to set a precedent as a warning to other lenders that people must not be mistreated. Whatever his reasons behind this decision, he saw something in the case that caused him to make a very drastic ruling.

It is interesting to note that no one has wondered if this lender has done anything about paying back the bailout funds they willingly accepted. Do you think they will give back the $814 Million? Maybe just $813 1/2 Million now......