Homeless with two dogs after losing her properties to foreclosure in 2012, a Virginia woman named Sheri Daniel has launched a crowdfunding campaign to get her out of her car and into a low-rent motel room so she can continue to fight her mortgage servicer and lender in court.
But more than that: “I just want to go home for the holidays,” Daniel said.
A few years ago, Daniel lost two properties in McLean, Virginia, a town of less than 40,000 residents near Washington, D.C., when she could no longer make her mortgage payments and loan modifications failed to provide adequate relief.
Down to what may be her last opportunity to seek relief from the courts, Daniel recently turned to GoFundMe.com to share her story with the masses and raise some money to help get her back on her feet.
The story is hardly unique, as Daniel is only one of the millions of Americans who lost properties during the housing market crash. But her story is remarkable for at least one reason: When her homes were foreclosed, Daniel was a real estate agent. In fact, she still is a real estate agent, selling homes to buyers in Northern Virginia, at a time when she herself has no place to call home.
And despite her professional knowledge, which should, at the very least, allow her to understand the circumstances surrounding the loss of her homes, to this day she hasn’t been able to untangle who actually owned her mortgages in the first place.
‘From wreck to wonderful’ — and back to wreck
In the mid-2000s, Daniel said residential real estate developers began buying properties in the McLean neighborhood (where she had purchased a Cape Cod-style home on Pinecrest Avenue in 2001), tearing them down and rebuilding “McMansions.”
To give her own property protection from a buyout, she purchased the house next door and intended to use it as a rental property after spending a considerable amount of money on renovations — “taking it from wreck to wonderful” — according to later court documents.
At the same time, after working as a real estate agent for nearly two decades — first with Long & Foster, then with Keller Williams — Daniel’s commission-only income began to dry up as the housing market took a tumble.
In 2009, Daniel applied for loan modifications on both properties with Wells Fargo Home Mortgage. The new monthly mortgage payment on her primary residence “stayed about the same,” Daniel said. But she was shocked when the loan modification Wells Fargo offered on the rental property increased the monthly payment by about 30 percent, or $1,200 a month.
“I was faced with a dilemma because they forced me to sign it. They simply said, ‘sign this or we will foreclose,’” Daniel alleged. “So I signed it and hoped the market would recover quickly.”
In 2010, Daniel had trouble making the increased payments on the rental property. For two years she attempted to work out a deal with Wells Fargo. When that failed, the lender scheduled 11 different foreclosure sales on the rental property and canceled 10 of them, Daniel alleged. In April, the rental property was foreclosed.
According to later court documents, Daniel collapsed from the stress and suffered severe health problems for the next four months. Although the mortgage payments on her primary residence had been current until that point, she fell behind. In what she called a “weakened, confused state,” Daniel said she made a feeble attempt to work out a new loan modification with Wells Fargo, but she never financially recovered.
The foreclosure sale on her primary residence happened in November 2012 — but Daniel refused to leave her home.
“I knew something wasn’t right,” she said.
‘Absolutely no record’ of the mortgage
Daniel was confused in January 2013 when Bank of America (rather than Wells Fargo) filed a summons for unlawful detainer to remove her from her home. That same month, Wells Fargo sent Daniel “an IRS Form 1099 showing Fannie Mae as the owner of the primary residence, not Wells Fargo or Bank of America, who are seeking an unlawful detainer.” She alleged that she made several calls to Bank of America, but company representatives told her they had “absolutely no record” of her mortgage.
A few months later, Daniel said she received a notice from the Federal Reserve Board, explaining that as a result of an $85-million settlement it reached with Wells Fargo to resolve concerns over its subprime mortgage loan practices, she may be eligible to receive a payment.
Noting that the loan modification documents for both lost properties identified Wells Fargo as the lender, Daniel formed the opinion that the loan modifications had been invalid contracts. Because the numbers used to execute the foreclosure sales were from false loan modification documents, she figured the foreclosure sales and eviction attempt may be invalid, too.
In February 2014, after Daniel’s attempts to get answers or seek relief from the court system proved unsuccessful, police escorted her out of her primary residence. Throughout all of the proceedings, Daniel said she was given little opportunity to discuss the particulars of her case or get answers about who the actual investor on her property was, and who had legal standing to issue loan modifications, initiate foreclosure actions or evict her from her home.
“As a real estate agent, I had encountered this strategy with the banks to push cases through the courts and count on the homeowner not being able to fight it,” Daniel said. “Most homeowners don’t have the resources or ability to fight it.”
Now homeless and desperate for answers, Daniel began writing to different federal agencies for help. She continued to log umpteen hours in law libraries, trying to figure out her next legal maneuver. And a few months later, something unexpected happened.
‘No longer in a stunned stupor’
In January of this year, Daniel received a letter from Bank of America on behalf of the Consumer Financial Protection Bureau (CFPB). Daniel had asked the CFPB to intervene in her case — or at least help identify who her loans’ actual investor was — and the CFPB contacted Bank of America to provide her with a response.
That response, sent by Lorraine Manhard, on behalf of Heather Richardson, customer relationship manager, stated, “Bank of America is unable to address the concerns included in your inquiry, as the information provided does not include enough detail for us to identify and research the matter. We were unable to locate information listed in the Bank of America systems indicating that we are the investor or the servicer for the property address, 6935 Pinecrest Ave., McLean, VA. If you send additional detail, such as the Bank of America loan number or a copy of the investor designation letter with the investor number from the servicer, we will research further.”
Daniel said she never heard from the CFPB or Bank of America again about the matter.
“I learned that if you file a complaint with the CFPB, they forward it to the defendant. And if they say their actions were justified, the CFPB doesn’t do any more for an individual. I think the case is still open,” she said.
But the letter from Bank of America gave Daniel a reason to keep pursuing the case, and some much-needed clarity on the complexities of her case, she said.
“I’m no longer stuck in a stunned stupor,” Daniel said. “I am thinking clearly again.”
Daniel’s next crack at justice was a complaint filed in May with the circuit court based on the new evidence. But Wells Fargo and Bank of America argued that Daniel’s claims should be barred for two reasons: One, because the matter had already been addressed by a competent court and two, because the statute of limitations on Daniel’s claims had expired.
The court agreed with the companies — but Daniel has not given up her fight.
Did Bank of America have standing to initiate foreclosure?
Unfazed by this latest loss, Daniel asked the Virginia Supreme Court to appeal the trial court’s decision. According to Daniel, the trial court erred “by finding the court had jurisdiction in the prior litigation because 1) The note was never assigned to Bank of America; 2) The letter from Bank of America states they have no record they are the investor for the property; 3) Bank of America never had any standing to initiate the foreclosure, the unlawful detainer or the subsequent litigation; and 4) The Circuit Court never had subject matter jurisdiction.”
Daniel’s petition for appeal also asked three dispositive questions that her previous cases did not address: “Did Bank of America have standing to initiate the foreclosure, the eviction and all the litigation? Are the loan modification documents valid contracts? Were invalid loan modification documents used to execute the foreclosures and to evict plaintiff from her house?”
On Nov. 2, Wells Fargo and Bank of America filed a brief in opposition to Daniel’s petition, calling the appeal the latest in her “ongoing and meritless attempts to challenge the foreclosure sales.” The companies also weighed in on the CFPB/Bank of America letter, calling Daniel’s reliance on it as justification for her current fraud claims “misplaced.”
“The … letter simply states that the information Ms. Daniel provided was insufficient to allow Bank of America to identify the loan or confirm Bank of America’s status as the investor, and invited Ms. Daniel to provide more information,” the companies contended. “This document does not support Ms. Daniel’s broad-brush conclusions that Bank of America never had an interest in the primary residence (whether as lender, investor or owner), that the modification agreements for both properties were fraudulent and that the foreclosures were therefore improper.”
Tom Goyda, vice president of Consumer Lending Communications for Wells Fargo, provided this statement to Inman:
“We made a number of efforts to assist Ms. Daniel and to avoid foreclosure, but unfortunately were unable to find an option that would allow her to keep either of the two properties she owned. We are confident that the foreclosure was conducted appropriately and all of the courts who have reviewed the case have agreed. Ms. Daniel has made a number of claims in at least two lawsuits and several appeals, and all of her claims have been dismissed at every level thus far.”
When pressed for more information on the circumstances that led to Daniel losing her properties, Goyda declined to go into details, but said, “All of her claims have been dismissed repeatedly thus far. I think that history speaks for itself.”
Bank of America declined to speak on the record, citing its policy of not commenting to the media on pending litigation.
Seeking a happy ending — in life and in real estate
Daniel headed back to the Supreme Court of Virginia in Richmond on Dec. 8 for one last attempt to convince the court to consider her appeal. The court’s decision is still pending.
At least some of the way Daniel’s case has unfolded in the courts may be due to the fact that she has been representing herself — partly because she can’t afford legal representation, but also because she said was unable to find an attorney that she felt would be able to get a court to consider the particular issues of her case.
“I did seek counsel from about five attorneys, and I learned something from each one of them,” she said. “But they all wanted to file foreclosure papers in a certain way.” Daniel explained that one attorney, for example, indicated she could get maybe $1,000 in a class-action lawsuit, which seemed futile.
Thomas R. White III, a law professor at the University of Virginia School of Law who specializes in real estate finance matters, shed some light on what Virginia state law has to say about foreclosure proceedings.
“In Virginia, foreclosure is controlled by the terms of the deed of trust which conveys the security interest (the mortgage) to the lender,” White said via email. “Typically, the lender has the right to appoint the trustees, and as a representative of the purchaser of the note, the loan servicer would appoint an individual or individuals to serve as trustees. When the loan is in default, absent restrictions on foreclosure by the holder of the mortgage, as provided in the deed of trust, the trustee may declare the loan in default and initiate foreclosure proceedings within a very short time, probably 30 days. When the sale is held and the purchaser of the property is determined, the borrower will not be able to rescind the sale.”
Meanwhile, a temporary, part-time job helping a real estate agent this summer enabled Daniel to rent a modest room at a motel, and the motel’s owner even agreed to give her a discount. But the loss of that second job made it impossible for Daniel to afford even the discounted motel room, and she has been living in her car with her two dogs since November. Family and friends would like to help, but Daniel would have to give up her two dogs, which she refuses to do.
That’s why Daniel turned to GoFundMe.com. Her campaign, titled, “Homeless Fighting Wells Fargo Fraud,” seeks $3,000, which she said “isn’t much, but it would be a lifesaver for me.” So far, she’s raised $420.
“I haven’t showered in a week,” said Daniel, who added that her humbling experience has given her new perspective on the challenges that homeowners in foreclosure face.
“The interesting and unfortunate thing about foreclosure is that a good deal for a buyer sometimes means that someone else had a hardship,” she said.
Not shying away from questions about how she handled her mortgages and case, Daniel added, “When it comes to foreclosures, there is often the presumption from people who haven’t been through it that if you are foreclosed upon, you did something wrong or were somehow at fault. We really need to be able to get beyond the assumption that the homeowner deserved it.”
Daniel is currently working as an agent for Barcroft Realty Group LLC, a new brokerage founded by a former colleague of Daniel’s at Long & Foster and Keller Williams.
Throughout this experience, “I’ve had days in the last year, especially since being evicted, when I did not want to continue in real estate because it had become so dirty, and that is not ever what I wanted to be part of when I decided to get into real estate,” Daniel said. “Working part-time for the agent this summer helped me realize how much I know, and this helped me turn the corner.
“I lost my passion for real estate, but I got it back,” she continued. “I’m a top-producing agent. I just need to get some justice.”