LIVING TO FIGHT ANOTHER DAY
One signature 16 years ago may cost woman her home
When Susan McGowan walked into the Mount Airy branch of now-defunct Beneficial Mortgage Co. on December 23, 1997 and signed an unsecured personal loan, she had no idea that she would spend every day of her life in misery for the next 16 years.
McGowan had been behind on a loan and received a telemarketing call from Beneficial to refinance the loan, and receive a check for Christmas money. Her husband had just died and she was raising two children by herself. When she got to the office to sign the loan, representatives Anne Robinette and Donna Tickle told her that the computer was down, and that all she needed to do was sign the back page of the loan, which happened to say “Right to Cancel”.
Roughly three weeks later she discovered that the mortgage on her home had jumped to $857 per month at 14 percent interest, which was up from the $238 per month at 4 percent interest she had been paying since she purchased her home in June 1992.
Now she is facing her third threat of foreclosure since 2010 on her home at 245 West Lebanon Street. Her hearing is scheduled for July 29, with the foreclosure for $57,000.
McGowan said she still lives with the shame of signing the document, despite not knowing any better at the time.
“I was 44 years old with 2 kids,” she said. “I didn’t know what I was doing.”
McGowan said that by not giving her the full story about her loan, Beneficial violated the Truth in Lending Act of 1968 that protects consumers from rogue credit practices and gives them a three-day window to reconsider taking a loan.
“If you borrow anything now you have to sign every page,” she said. “And you can’t take that money until you get that document in your hand.”
Robinette now lives in London, Ohio and Tickle in Charlotte. Neither could be reached for comment. No contact information could be found for Jimmy Doby, the Winston-Salem branch manager.
Since then McGowan has gone through five attorneys and 10 government agencies in trying to keep her house with no strings attached.
She was able to reduce her monthly mortgage rate to 6 percent in 2003 after working with an independent agency in Durham, and her house was completely paid for by January 2006.
The house is 102 years old and is worth $52,680, with the land being worth $12,000, according to the online Surry County parcel database. It is 102 years old and in serious need of repair. The paint is peeling, the carport is cracked and the inside is in need of attention.
McGowan’s grandmother left her $7,000 when she died, which she used to purchase the house. Her grandfather built some of her furniture. She knows she could put this behind her by moving to an apartment, but she feels she should not be in debt and is fighting to keep her home as long as she can.
“If you borrow $50 from me and you don’t pay it back I can’t take your house. I can take you to small claims court, but your house is not tied to the loan I gave you,” she said.
When she received her first foreclosure notice in 2010, McGowan filed for Chapter 13 bankruptcy. For 11 months she paid $1,250 per month until May 2011 when her case was dismissed but not all of her unsecured debt paid off. Further complicating matters was the fact that Beneficial was bought in 2009 by HSBC, which is based in London and Hong Kong. She tried to contact HSBC headquarters in London and discovered that foreclosure prevention programs do not apply to foreign banks.
McGowan was also eligible for a $10,000 grant in 2012 under the Treasury Department’s “Hardest Hit” fund””a federal program designed to give the states most severely affected by the housing crisis an opportunity to remain in their homes while they search for jobs. North Carolina received more than $482 million out of the $7.6 billion allocation to 18 states.
McGowan never got the money because she could not obtain billing statements from Beneficial.
A letter from HSBC spokeswoman Theresa Nicchia to Jennifer Winborne of the North Carolina Office of the Commissioner of Banks reads, “Due to the delinquency status of Ms. McGowan’s account, Beneficial is unable to comply with Ms. McGowan’s request to send monthly billing statements.” It goes on to say “Additionally, our prior correspondence indicated we had not received any third party authorizations.”
She did, however, receive a check for $3,000 in 2013 as a result of a US-class action lawsuit against HSBC.
McGowan has been pursuing government channels lately, having attempted to contact US Senator Elizabeth Warren (D-MA) who has made predatory lending one of her key issues since she was elected in 2012. Their office told Mc- Gowan to contact her senator, Richard Burr (R-NC), which she did. Burr’s press agent Rachel Hicks said casework is typically not made public.
“Due to constituent confidentiality concerns, it is our office’s policy not to share any details about constituent meetings or help our office may provide,” she said.
Lately, McGowan has been talking with Thomas Norton of The Norton Group””a Princeton, New Jersey consulting group aimed at educating the public about predatory lending, subprime loans and credit fraud. Norton said McGowan’s situation is no different from many he has seen across the country.
“She’s just a poor woman, and she’s trying to save her life if you will,” Norton said.
He said predatory lending became an issue with the mortgage failures of the mid-2000’s. He thinks part of the problem with McGowan’s case is the lack of an authenticated rundown from the day the loan was put on the books until today.
“To put it mildly it was very loose at the origin of a loan,” he said.
McGowan has a bachelor’s degree in business from Gardner-Webb University but said with the amount of legal issues she has dealt with for the past 16 years, she might as well have a law degree. She has been keeping her paperwork in a briefcase, which remains open on her dining room table due to its volume.
What McGowan really wants now is to get her life back.
“I’m going to lose 22 years of equity,” she said. “I’m going to be 60 years old and have nothing. Start over with nothing. And for 16 years I could have been living.”
McGowan, an independent insurance agent, has not sold a policy this year and has been living on residuals from the last 20 years of sales. Stress has caused her thyroid to not function properly in addition to other health problems she has faced including high blood pressure, fainting, insomnia and frequent nightmares. She is on seven prescription medications.
For the last two years she has seen a therapist for situational depression. Her support network consists of a few friends and most of her living family members have not been very supportive. She rarely sees her two grown sons who are in their 30’s and have no idea of their mother’s struggles.
“The children were small and I didn’t want anybody to find out that I was losing the house to a subprime lender,” she said. “I didn’t even tell my parents.”
She said when she found out her house might foreclose she told her sons she was selling the house so they would not worry.
“They don’t need to know, because I raised them by myself and they’re going to think I’m a loser,” she said.
McGowan is in the process of writing a book called “God is There”¦Just ask Me,” about her experience. She said just helping one person would bring a smile to her face.
“They’re saying I’m an Erin Brokovich and they’re going to shut me up,” she said. “But it depends on how strong I am.
McGowan said she has days when she cries all the time. If her house does foreclose, she will likely have between three weeks and six months to find a new place. Somehow, she remains optimistic.
“It doesn’t matter where you live,” she said. “It’s how you live. I have no regrets. This is not my fault. God gave me the strength to pursue and you know with 1200 emails I have pursued.” !