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Mortgage fraud scheme: Families displaced by housing fraud
"Lost in the shuffle"
SIKESTON -- The past week has been a big shuffle for Kristi Orman and her three children.
Orman lived in one of the homes that was part of the mortgage fraud scheme that hit Sikeston. She's known that she would eventually have to vacate her home, and had made arrangements to move into an apartment by Dec. 10.
But the mortgage company that foreclosed on her home, EMC Mortgage, said she had to move out by Friday.
So this week, she and her three children are living in a room at the Midtowner Motel.
"It's crazy," Orman said. "It's really put a burden on me."
Others who live in homes that were also foreclosed on are facing similar dilemmas. According to Scott County Recorder Tom Dirnberger, there have been at least 300 fraudulent loans in the county, most of which resulted in foreclosures. A large portion of the affected properties are on the west side of Sikeston.
Jenny Hobeck, principal at the Sikeston Kindergarten Center, said her secretary noticed several families calling with a change of address, due to their rental homes being foreclosed on.
"We've had about three parents call (Friday)," she said.
The DAEOC Homeless Shelter in town isn't able to meet demand.
"We have several on the list now that their house is being foreclosed on," said Gina Crowley, homeless project case manager. "We just don't have the room to put them up."
The shelter only has six units, so that makes it difficult to fill the need.
"They come in all the time," she said. That leaves those without a home to stay with family, friends, or at a hotel, like the Ormans.
Crowley said those who stay have a hard time finding a new place; and just need to catch up their finances.
"A lot of times if the house is foreclosed on, they don't get their deposit back," she said.
Orman said that she met with representatives from the mortgage company on Nov. 20, and she told them she was set to move Dec. 10. "They said, 'no problem,'" she recalled.
But then last Wednesday, representatives came back and said she needed to move out by Dec. 1 -- and since that fell on a Saturday, Orman had to vacate the home by Friday.
With the short notice, as well as being out of pocket for the hotel, Orman didn't have the money for a storage shed for her belongings. She was able to use a friend's shed -- but it had a leak, so all her furniture was destroyed with the weekend rains.
"We pretty much just have our clothes," she said.
Orman said she is supposed to receive $500 of relocation assistance from the mortgage company. "But that's nothing, considering that now I'm going to have to buy new furniture."
She's also got the extra cost of food for the week, since Orman doesn't have a refrigerator or any other appliances at the motel. "We bought a hot plate to keep there," she said. They'll use that to make dishes such as noodles and soup.
Orman hopes she can move into her new home on Friday, three days earlier than planned. "(The manager) said she would try to push it," Orman said.
Jack Vincent, a local real estate broker who manages properties -- and had managed several of the properties after the owners became disgruntled with Century Mortgage, which previously managed them -- said that several tenants got lost in the shuffle, and are having problems finding a place to live.
"I get 10 calls a day and I don't have properties to rent," Vincent said. And, based on the simple rules of supply and demand, that's driving up rental rates.
In all of the properties he managed, however, Vincent said he gave the tenants ample notice that they would soon have to move, so they should begin looking for other housing.
Larry Lindsey, a Realtor with Century 21 (in no way connected to Century Mortgage, which is now defunct), said most of the people he's worked with have found a new place to live. However, he didn't know whether these people had to stretch their budgets a bit more to make rent.
Orman's friend, Heather Hood, has been without a home since mid-June, just a few weeks after she had a baby.
She said the crisis has definitely impacted the housing market, especially homes that qualify for Section 8.
"People are racing to get the houses available," Hood said. "There's nothing here now -- except with too high of rent."
Hood knew her home was being foreclosed on. However, her manager, William Churchill with Century Mortgage, told Hood it would be OK. "He said someone was going to buy the property and collect rent just like he did."
But two days after her daughter was born, she received a letter stating that she had a week to vacate the property. She spoke to the sheriff, who said the company "could come and put my stuff out on the street."
Hood went back to work only three weeks after having her daughter, while she was at the Children's Hospital in St. Louis. Hood now works two jobs, but that's still not enough.
"We live, basically, out of my car," she said. "All of my kids' clothes and my things are in the trunk of my car."
They bounce out of friends and family members' homes as space is available, Hood said.
From this aspect, children are some of the biggest losers.
Orman said that her children have faced a lot of confusion in the past week. "It's a 'where are we going today' kind of thing," she said.
And Hood said her daughter is hurt by the whole experience. "She can't have her own space, or her own time -- she cries about it, she does want our own house," Hood said. In fact, she said, her daughter's teacher noticed how sad she was about the whole ordeal.
Hobeck said she and other faculty "just feel sorry for the family and the kids." But, she expressed some concern about school enrollment, as well as the local economy, especially if tenants have to move out of the city limits to find affordable housing.
"With that many houses, we're really concerned about how that can affect us," Hobeck said. "Both the district and the community."