Tuesday, January 29th, 2008 at 4:30 PM
“Stolen Equity”
Those of you who follow the defaults in Carlsbad saw an old friend come back on the list last week – 3745 Adams. The ‘house’ was hand-built of adobe bricks by the owner back in the 1950s, and looks it – there are parts that have no floor.
Bit it’s on nearly an acre of land, and though it is close to the freeway, it is still valuable – especially to my church next door, who has been hoping to expand.
I tracked down the owner’s daughter the last time they hit the NOD list, and luckily she remembered that our kids were in the same class a few years back. I expressed my willingness to help her with the situation – but she felt she had it all handled. She still wanted to "develop the property".
She got into a bind the first time around because she had taken out a $640,000 loan, and had trouble making the payments (She doesn’t work, her husband is a truck driver, and mom is in the rest home in Washington). So she took out a small second with a hard-money lender, who, according to her, promised to advance more funds to help develop the property. Apparently he mis-understood, and instead tried to foreclose on her.
I offered her $1,000,000 for the property, on behalf of a coalition of parishioners who would turn it over to the church once the expansion plans were in place. She refused to consider it, insisting that she would endure this hardship and carry on with her deceased father’s plans to build it out.
Knowing that she was into more than she could handle, and thinking she might reconsider, I helped her with the paperwork to escape the foreclosure. Literally the day before she was about to lose the property, she got a court injunction to stop the trustee sale, due to ‘elder abuse’.
The lender rescinded his foreclosure proceedings, after an attorney threatened to sue him. The most unbelievable part of the whole story was that the lender then cancelled his second note and trust deed, and let her walk with around $40,000.
I offered my deal again, but she refused, because she had another lender willing to give her $90,000 – enough to make payments on the first, plus some walking-around money. That hard-money lender insisted though that she sign over the grant deed – which she did, under the agreement that she could buy back the property in six months. Why she thought that deal was better than our million dollars is beyond me.
But somehow she pulled it off, and in October the property reverted back to Mom.
Yesterday I got this email from her:
Just Seven months ago a group of volunteers formed the Kokopelli Board of Directors and gave birth to a wonderful non-profit community benefit project. The Kokopelli Community Workshop project, was created to open a educational workshop and educational Center in Carlsbad California.
A large adobe complex, located on a acre of land on Adams Street in Old Carlsbad was donated the project, by 84-year old longtime Carlsbad homeowner, Betty Bryan, (Betty is guaranteed lifetime occupancy by the project, in private rooms located adjacent to the main building)
The original eight kokopelli board members included; two college teachers, (one teaches copy writing and one teaches finance) an attorney, and her legal assistant, an editor, a journalist, (that’s me) a computer design expert, and a well known holistic health professional, who works successfully with cancer patients.
We also been busily involved planning fundraisers, collecting books for our library and meditation center. We have all contributed many nights and week-ends, to remodeling the large adobe structure located on an acre of land located adjacent to St.Patrick’s Church in Carlsbad.
Over the last months we have accomplished the following; we have landscaped the grounds and rented a back-hoe and replaced the leach-lines, which run directly under our planned community aquaponic organic farm project located directly behind the adobe structure.
THE CURRENT CRISES ;
Last July an investor from Oceanside, a man named Mr. Rick Ardissoni was introduced to us as someone who was interested in helping the Kokopelli Community Workshop Project. He was introduced to our project as an investor who could potentially advance the needed funds for our project to keep rolling, if he could be repaid at the end of January 2008 when our project funding would begin to become available.
Mr. Ardissoni joined our board of Directors, attended our meetings and seemed to show benevolent interest in our project. So we convened a special meeting our our finance committee and voted to execute a $600,000 "line of credit" trust deed to be recorded against Betty Bryan’s property, naming Mr. Rock Ardissoni as beneficiary.
On October 10, 2007 the trust deed was recorded at the San Diego County recorders office securing Mr. Ardissoni’s interests to enable our "line of credit. " We were led to believe that this security would enable Mr. Ardissoni to provide sufficient funds to keep our project rolling. In this way we hoped to keep the headquarter’s mortgage paid and be able to continue our remodeling work until our grant money could begin to benefit the kokopelli project at the end of January 2008.
At the end of November 2007, after Mr. Ardissoni had advanced the project a grand total $34,000, when he suddenly refused to attend board meetings and apparently lost all interest in the Kokopelli project.
Mr. Ardissoni also refused to advance us any further funds.
Alarmed we scrambled to find another investor, because our financial director warned us that the property must be maintained in good standing, in order qualify any potential grants. Finally we were thrilled to locate a benefactor who was willing to step into Mr. Ardissoni’s position.
Early in December, the alternative investor, a genuine benefactor, offered us $100,000 in private money so that we might repay Mr. Ardissoni $ 44,000 from a new loan. (This amount included $10,000 interest on the original investment of $34,000)
Kokopelli project planned to use the balance of the new loan funds to reinstate our mortgage, and then make timely mortgage payments until our grant funding and other fundraising projects could make additional funds available.
Mr Ardisoni’s existing $600,000 trust deed would need to be re-conveyed as a funding condition. Then a new trust deed for a lower amount ($120,000) could be issued to the new investor , which would allow Mr.Ardissoini to be reimbursed $44,000 from the closing the new loan escrow.
When Mr. Ardissoni was informed that he could be immediately repaid, much to our dismay, he let us know that he was not interested in being repaid only $44,000, and also that all further communication must be to his attorney ( Mr. James Maynard, of Carlsbad.) Attorney James Maynard contacted us only once to communicate that his client was "not inclined’ to re-convey the $600,000 trust deed. Now attorney James Maynard does not seem to answer his office phone or bother to return our calls.
As of January 2008, Betty Bryan’s home and property was put into foreclosure status.
Mr. Ardissoni’s refusal to re-convey our equity has now additionally prevented Betty Bryan from qualifying for a federally guaranteed FHA refinance loan, that would have resulted in a much lower more affordable mortgage payment.
Betty Bryan qualified for this special FHA govenment program as one of approximately 2.2 million homeowners who borrowed against their homes between 1998 and 2006 and most have a subprime mortgage. Many of these borrowers now face the loss of their homes to foreclosure. Earlier this year, 80% of subprime home loans which had fixed rates initially, became adjustable. That is, the interest rates jumped higher on either the 25 month or the 37th month. This jump in the monthly payment caused "payment shock" for the affected homeowners. Many of the loan payments increased by about 40%. Unable to make these new higher payments, these homeowners face foreclosure.
As of January 2008 Betty Bryan’s home and property is recorded as being in foreclosure, and due to the stolen equity this 84-year old, 50 year resident of Carlsbad no longer qualifies for a loan, and may soon be made homeless.
We have tried to explain to Mr. Ardissoni that if he allows the property to go into a mortgage default Kokopelli project would not qualify for any of the grants everyone worked so hard to submit. In response, Mr. Ardissoni said he would just have to protect his interests and referred us to an attorney James Maynard who does not return any of our calls.
Kokopelli Community Workshop project has now retained the service of an attorney, who is a specialist in fighting predatory lending. We are very fortunate that Mr.Fransen has taken our case on contingency, BUT…… unless we can pay the court costs and get the property out of default, senior Betty Bryan stands to become homeless in a couple of months, and a valuable community project; Kokopelli Community Workshop will to be lost to these loan predator’s tricks.
SO PLEASE HELP US SAVE BETTY BRYAN’S HOME AND OUR COMMUNITY WORKSHOP PROJECT!
We want you to know that any help you can give will make a huge difference. Please make Betty a donation, even if all you can only spare a dollar or two. If everyone who reads this email sends Betty just $5.00 we will be able to save her home.
please send to all donations by mail to;
Betty Bryan
PO box 1410
Carlsbad Ca 92018
In any case thanks for reading all about this crises!
We must create community awareness of these predatory tactics to often used to steal peoples homes and real estate. Kokopelli Community Workshop will also implement a special foreclosure workshop to help individuals and families whose homes are in foreclosure or who have mortgage loans about to enter an adjustable rate understand their options; including but not limited to all government programs, bankruptcy options, short sale opportunities, legal stays against foreclosure, and to help those in need to thoroughly review understand and review the financial and legal consequences of all potential loans or other creative financing schemes that may have under consideration, in a protected and legally sanctioned environment.
Also remember to keep a copy of your donation as it is tax deduct-able.
Posted on Tuesday, January 29th, 2008 at 4:30 PM in Unbelieveable | 22 Comments » | 
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I hate to sound unsympathetic, but I can’t help thinking that donating to people this naive (I’ll use that description instead of the more strongly worded one I’m actually thinking) would just be throwing money down a deep hole.
GeneK | January 29th, 2008 at 6:09 pmNo problem gene, I don’t expect people to contribute – it is posted as a lesson. If you find yourself in a pickle, rely on some quality help.
This lady absolutely refused to listen to anyone – she thought that if she could just get her hands on a little more dough, somehow it would all work out.
At least three different times she trusted a hard-money lender to take care of her – but they had different ideas on what that meant.
Jim the Realtor | January 29th, 2008 at 6:28 pm"A fool and his money are soon parted." -Thomas Tusser
greenlander | January 29th, 2008 at 6:32 pmEven better:
A fool and is money are soon invited everywhere.
Plaque in Warren Buffet’s office.
Lostozzy | January 29th, 2008 at 6:51 pmSteal? Steal?? Sounds to me like you signed the home over to Ardissoni fair and square.
Ultimately, this just sounds like begging on a really grand scale.
sb | January 29th, 2008 at 7:32 pmI don’t get it. So who is trying to foreclose her home now? The second 100k one or the first guy? or She just making everything up.
Arty | January 29th, 2008 at 7:43 pmI’m having trouble finding sympathy here, much less compassion. Seems like the moral of the story is "Don’t be a retard."
Genius | January 29th, 2008 at 7:53 pmI think greenlander summed it up for me as well. It was the first thing that came to my mind while reading the piece.
Daniel | January 29th, 2008 at 8:19 pmOh, and one more thing, Jim: this may actually be a blessing in disguise for you. I have a pretty strong feeling that Mr. Ardissoni, unlike the current owner, may be inclined to sell the property (to the church, or anybody else) if he is offered a fair price for it. Now, whether that would be more or less than 1M, I can’t really speculate.
Daniel | January 29th, 2008 at 8:29 pmI have come up with a new life corollary based solely upon this story. I’ve seen billionaires say some things similar but until now I had never understood.
"Intergenerational transfers of wealth are not healthy to society and rarely benefit the recipient."
This/these person/s was/were never qualified to administer this asset.
Rob Dawg | January 29th, 2008 at 8:36 pmIt just occurred to me, they received $34,000 in Oct ‘07, and by Dec ‘07 owed $10,000 in interest? I think I could have gotten a better rate than that from a credit card advance…
GeneK | January 29th, 2008 at 8:57 pm"The original eight kokopelli board members included; two college teachers, (one teaches copy writing and one teaches finance)"
Teaches Finance? Must be at one of those online colleges.
TakeFive | January 29th, 2008 at 10:04 pmFor a number of reasons, I’m not all that sympathetic to your church buying the property either. Of course, you have the right to expand, but it doesn’t necessarily help the community to see a parcel of land such as this go tax exempt.
Overall, there’s not a lot to be sympathetic about here. The landowners seem to be just a bit on the side of eccentric, but not for refusing your regular offers to sell.
Jim, while it’s certainly that the landowners would have been better served to take your offer, it’s clear they had other plans. That doesn’t make them stupid. What they did with their property after refusing your offers makes them stupid. In the end, it’s the landowner’s right to do with their property as they wish (within the law of course). I suppose that means even if they lose it to so called "hard money lenders", at least they did what they wanted to do.
ice weasel | January 29th, 2008 at 10:45 pm…and are now pleading for others to donate money to help bail them out. I don’t disagree with the idea that they had the right to make bad financial decisions with their land. It’s their attempt to insult our intelligence by suggesting that others should contribute to their cause because their situation is the result of their being victimized by "predators," and not the entirely foreseeable result of their own ineptness that is galling.
GeneK | January 29th, 2008 at 11:12 pmWhat makes me mad is not that this lady lost her property by being stupid…it’s that a scumbag like Mr. Ardissoni and his attorney get rewarded for their conspiracy and get an acre of prime land for pennies. Mr. A should go work with Super J.
annon | January 30th, 2008 at 2:12 amBe glad you didn’t get entangled with these weirdos. What a bloodbath. With lawyer sharks swimming around in it.
RBRenter | January 30th, 2008 at 3:05 amice – the gubbermint isn’t getting rich on the current $703 per year in property taxes, if they are being paid. But granted, a better use for the property would improve the tax base.
We struggled with the highest and best use – what if we bought it and the church never comes around because of the diocese BK or declining enrollment in the school (school expansion is the goal)???
Is there a market for new houses that close to the freeway, which is just 150ft away? Other houses for sale in the vicinity are languishing on the market. The best we could figure was build four one-story SFRs for church-goers who want to walk, or go for a variance and build condos. Neither sounded like an appealing use of time or money.
Now a year later it really doesn’t sound appealing. Think the diocese bankruptcy will prevent any earnest discussions of a new school?
It goes to show you, when your train comes in, don’t be at the bus station.
Jim the Realtor | January 30th, 2008 at 3:06 amCan someone please deconstruct this long story into a few sentences? I understand that Mr. A pulled a clever one, but what exactly is the structure of the whole cam? Mr. A paid 600k to get the deed from the hard money lender, and then lended the original owner ~40k to get her into a hole so that he could foreclose against her?
I do not quite understand how the numbers add up, nor how Mr.A now effectively controls the building.
justme | January 31st, 2008 at 4:20 pmI’m going to check on it, but I belive that the loan friom Mr. A ended up as a second behind the $640,000 first. He has only loaned her $40,000 so far, so her combined loan balances are around $700,000 currently.
If he pulls the plug and forecloses, instead of loaning more on the credit line, he’ll be responsible for payments on the $640,000.
Is it worth $650,000 to $700,000 now? Or more? We’ll see in the coming months.
Jim the Realtor | January 31st, 2008 at 4:36 pmThanks, Jim. So the explanation is basically that he can bid 700k at the foreclosure auction and maybe get the house, since the bank with the 640k 1st loan probably will not want to bid any higher either.
justme | February 2nd, 2008 at 11:27 pmJim, confusing reading this one. You might want to brush up on either blockquote tag to indent the "email" portion, or use a change in font color to offset it. At the heading "The current crises" i thought it was reverting back to your voice at first.
Emmi | February 4th, 2008 at 7:33 amMy name is Catherine Bryan Ibarra and I would like to make correct quite a few of to the interesting statements Jim Klinge has posted here.(and please update your photos Jim!)
What Mr. Klinge is apparently completely unaware of is that we do have a buyer waiting, but a pending lawsuit has prevented any potential sale of Betty Bryan’s home and property.
It seems the game being played is to force an 84 year old Betty Bryan’s home into foreclosure while preventing any possible sale.
Mr Ardissoni’s criminal and illegitimate lien for $600,000 must be rescinded, (Ardissoni had advanced only $31,000 and last December he refused to be paid back $44,000 to reconvey his illegal and inappropriate $600,000 "line of credit" trust deed)
For everyone’s information, Betty Bryan and Kokopelli Community Workshop have retained the services of an Oceanside attorney who has now initiated legal proceedings against Ardissoni,
this process may take up to a year. Meanwhile
Kokopelli Community Workshop Corporation is creating a series of benefits and other fundraisers to pay the 84-year-old homeowner’s mortgage.
Her attorney has recommended that Betty Bryan’s current legal situation in respect to the property has to be completely resolved before any potential sale can be legally finalized.
2nd of all it was our understanding that although Jim Klinge mentioned a potential offer of $1,000,000 from certain parties, when pressed the offer was immediately withdrawn. (Jim said this was due to financial problems involving the church. )
While it has certainly true that Mr. Klinge approached our family quite a few times to allow him to place our property for sale, He has NEVER actually given us an verifiable offer.
Finally as a journalist I must advise Mr. Klinge should not make personal statements regarding others without actually checking into
the correctness of his sources of information, and of course legally he must also request their permission.
.
I find it interesting that Mr. Klinge chooses to describe me as unemployed. Actually I not only work full time as the publisher of Communiversity Magazine, an on-line version can be found at;
http://www.communiversitymagazine.com/
Where we offer a fairly comprehensive foreclosure help clinic among many other services offered at Communiversity Magazine if anyone is interested?
I also serve on the board of directors of Kokopelli Community Workshop Corporation, as well as pursuing a full time career as a journalist in college.
KOKOPELLI COMMUNITY WORKSHOP MISSION STATEMENT
Kokopelli is a non-profit public benefit organization who has been implementing the SDGCE Events Project to create more awareness between groups and organizations in the local and global community.
At Kokopelli we have become aware that many families are experiencing financial challenges and many more are actually in crises.
We believe The Global Empowerment Festivals Project can encourage and implement enhanced community connection and eventually enable a tremendous redirection and refocusing of our economic and social priorities as a culture and society.
Kokopelli Workshop hopes to nurture a grassroots movement and allegiance of community intention toward a peaceful humanitarian earth.
Catherine Ibarra
founder and creative director
Kokopelli Community Workshop Corporation & the SDGCE event team
760 729 8431
Catherine Bryan Ibarra | May 3rd, 2008 at 3:24 pm