Homeowner Makes $69K+ In Loan Payments, Then Finds Out Lawyer Who Handled Closing Never Recorded Deed, Mtge; Title Insurer To Victim: 'Take A Hike!'
In Scranton, Pennsylvania, The Scranton Times-Tribune reports:
- For more than three years, Shelia M. Layo made $69,594 in mortgage payments on a property she did not own.
The Scranton woman is living in the house, which she still doesn't own, and is suing Peoples Neighborhood Bank, closing agent Richard Hallock and others in a bizarre case involving the failure to record a deed and a mortgage.
The Hallstead-based bank didn't tell her about the incomplete closing or remedy the situation. Yet the bank wanted her to continue to make payments, noting that she is still personally liable for the note. Frustrated, she stopped paying. The bank sent her a notice of intention to foreclose in May, even though it couldn't foreclose without a mortgage and without her being the owner.
An attorney, Mr. Hallock has since pleaded guilty to felony theft in an unrelated matter and was suspended from practicing law for three years. He has moved out of the area - leaving in his wake a flurry of escrow and financial irregularities - and could not be located for comment.
Ms. Layo is suing the bank for possession of the townhouse and $397,725 which includes her 42 months of mortgage payments, Mr. Hallock's fee, other closing costs and losses, plus her legal fees. She is asking for other damages from Mr. Hallock and the firm he was an agent of, Ohio Bar Title Insurance.
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- Ohio Bar Title [] declined to help, denying her coverage through its errors and omissions insurance, even though Mr. Hallock was acting as its agent.
There's another cost to Ms. Layo. The condo is in a Keystone Opportunity Zone, so she's supposed to receive tax benefits. Because she has no evidence that she owns the property, she was never able to take advantage of the benefits, which include exemptions from some property and income taxes.
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