Lawyer: Couple in their 70s and on fixed income was given a 30-year, $160,000 loan.
EAST PALESTINE — A 72-year-old woman who feared she’d lose her home to foreclosure hanged herself to death, the family lawyer said.
Betty J. Lipply of 51535 state Route 14 died the morning of Jan. 24 at her home, just days after receiving her second summons and foreclosure complaint from her mortgage lender, said Atty. Robert B. Holman of Bedford.
“I last spoke to her at 8:30 the night before. I was there at the house, and my aunt and uncle were there from Illinois,” said Lipply’s daughter, Sherrie Blum of Darlington, Pa. “She talked constantly about the foreclosure, thought she would lose the home my father built for them.”
Blum said her aunt found her mother dead the next morning.
“I have no doubt it was the foreclosure. This is devastating to the family. My father doesn’t want anyone in the United States to go through this ever again.”
The foreclosure complaint was filed Jan. 6 in Columbiana County Common Pleas Court by Chase Home Finance in Columbus. The defendants named are Robert Lipply, 72, his wife, Betty Lipply, and Home Savings and Loan in Youngstown, the second lien holder.
In a 31-page counterclaim lawsuit, Holman names as third-party defendants Lake Erie Title Agency in Dayton, North Coast Capital Funding in Cuyahoga Falls and SML Corporation, a real estate agency in Hudson, Ohio.
Holman alleges in the lawsuit filed on behalf of the Lipplys that the Lipplys were the victims of a predatory lending scheme. He said the bank, mortgage company and title insurance company used an inflated appraisal of $200,000 to create an over-inflated mortgage loan, thereby putting the Lipplys on the path to financial ruin. He said the property at 51535 state Route 14 had a market value of $80,000.
In late 2004, the Lipplys sought a mortgage loan to refinance their existing mortgage debt and pay off the original mortgage of $147,501, Holman said. They were provided a $160,000 mortgage loan without showing whether either was employed or had any assets to qualify for the loan, he said in court papers.
The lawsuit says North Coast owns the majority of common stock in SML and Lake Erie Title, and North Coast loaned the Lipplys $160,000 and obtained an interest in the property in 2005. Also, North Coast or SML contracted with Lake Erie Title to perform title work and escrow services in conjunction with the Lipplys’ loan and the high appraisal was used as a basis to support approval of a loan for a much higher amount than would have otherwise been approved, the lawsuit alleges.
Chase, holder of the January 2005 note, claims that, through default, $153,839 is due plus interest from June 2008. Chase’s attorney, Erin Jochim, did not respond to phone messages seeking comment.
The Lipplys, both retired, have been on fixed income of roughly $1,600 per month. Holman said the 30-year loan payment was $1,169 per month.
The Lipplys had an older house next door at 51529 state Route 14, valued at $68,000, which was foreclosed on in 2007, the lawsuit states.
That’s when Betty Lipply began suffering severe bouts of depression and anxiety, realizing that their residence would also be the subject of foreclosure, the lawsuit states.
She tried to sell the property 51529 state Route 14 at $156,000 but got no offers and it was sold at sheriff’s sale, court papers show. They do not list the selling price.
She received notice of the current foreclosure on Jan. 13 and felt she had no options left to save her home and took her own life, the lawsuit states.
The lawsuit alleges North Coast, SML and Lake Erie Title acted together to induce the Lipplys into entering a loan that was not in their best interest.
The lawsuit seeks attorney fees, and punitive and compensatory damages to be determined at trial.