Widow’s refinancing turns into horror

Instead, she said, she was tricked into selling the house cheap and paying high rent to some of the people who cheated her. Yet despite the Nevada Mortgage Lending Division’s confirmation of her charges, somebody else still owns the house, she kept on paying rent, and at least one of those who cheated her was recently back in the mortgage-lending business.

Sitting in the living room she once owned, in a pleasant, middle-class southwestern neighborhood, Jacobs explained that much of the household income she shared with her husband, Everett, depended upon his pensions and Social Security. After his death in December 2004, those sources were reduced to survivor’s benefits, and her mortgage payment of about $1,100 a month became difficult to meet.

“I had been seeing these ads for Ameriquest, offering to refinance my home, and I went over there,” she said. “They sent me on to another company called Pacific Financial Group. I made it very clear what I was trying to do. The guy gave me a $5,000 check and told me ‘We’ll settle the details when I get back from Mexico.’ … So I came back Monday and he said I’d sold the house.”

And she could rent it back for $1,200 a month.

Jacob’s whole idea, of course, had been to avoid selling the house. She was never even told the sale price, Jacobs claimed. “I got $45,000 and they said I would get $75,000 if I was forced to move, but I don’t know how they came to that conclusion.”

The buyer turned out to be Crystal Lee Hussey, who occupied a desk next to Brian S. Martin, the PFG office manager who cut the deal with Jacobs. And Hussey borrowed the money to make the purchase from Brad Gardner, a California financier who has been identified as the owner of Pacific Financial Group, according to court documents filed on behalf of both Jacobs and Gardner.

Jacobs sued, but Judge Michael Cherry of the Clark County District Court granted motions dismissing both Ameriquest and Gardner as defendants. However, Jacobs’ lawyer, David C. Amesbury, said through a subordinate that Gardner remains a defendant in a related lawsuit by some mortgage middlemen. Jacobs’ lawyers hope to recover a judgment against the middlemen who presumably will then seek reimbursement from Gardner.

In July 2006, the Nevada Mortgage Lending Division issued a cease-and-desist order against Martin, including the finding that “Martin and Hussey conspired to mislead Jacobs into deeding away her residence by telling her she was signing papers necessary to refinance her house.” It also said that $75,000 was diverted from the purchase price to M Construction, a paper corporation owned by Martin, for “improvements” that never existed.

The order fined Martin $420,000. A similar order fined Hussey $20,000. Hussey’s license as a mortgage broker was revoked; Martin’s was not, because he didn’t have one, but he was ordered to get out of the mortgage business.

Martin’s whereabouts are unknown, but Jacobs’ lawyers say that Hussey admitted in a deposition that she is still in the mortgage business in Nevada, though in a subordinate position requiring no license.

Pacific Financial Group also lost its license and was fined $370,000.

Ameriquest is famous as a principal contributor to the foreclosure crisis, originating more subprime loans in Nevada than any other lender. It was also famous for doling out Rolling Stones concert tickets worth as much as $800 to Nevada legislators able to influence mortgage-related legislation. The national company eventually fell apart and sold its surviving assets in September.

Wilma Jacobs is 83 now, and offers others some hard-won wisdom. “Be very careful who you talk to about refinancing,” she said. In fact, she said, it would be a good idea to hire a lawyer even before contacting a lender.