Margaret Mosunic is 63 and a devout Christian, but if she ever encounters her building contractor again, she has a specific, violent plan of action.
"I want to choke his little Irish neck," she said in a recent interview in her home of more than 40 years in Queens, New York.
As for the mortgage broker who recommended the contractor? "[He is] a devil in the disguise of a man," she said.
On Jan. 9, 2008, Thomas Delaney, a broker at Home Consultants, Inc., drove Mosunic to a law office to close what she thought was a $40,000 bank loan, according to a lawsuit filed by Mosunic in Queens County court. She planned to use the money to pay back taxes and make repairs to a downstairs rental apartment, she said.
But that wasn't the loan that the broker had asked the lender, Emigrant Mortgage Co. of New York to approve, Mosunic's lawsuit alleges.
An hour later, Mosunic claims, she stood on a street corner with a $20 bill that Delaney had pressed into her hand for cab fare, confused and upset. She had just signed her name to a $300,000 mortgage with terms she alleges she couldn't possibly meet.
Mosunic's loan required a monthly payment of $2,227. At the time, her only income was a $738 monthly disability check.
"I was flabbergasted and I was so upset," Mosunic said when she got her first bill.
The interest rate on the loan was 8.125 percent. But if she missed a single payment by more than 30 days, the rate would jump up to a "default" rate of 18 percent. If that happened, her monthly bill would double, to about $4,500 a month.
While Mosunic was obligated to make payments on the full loan amount, the bank held back half--$150,000--in escrow, with its release contingent on repairs to a downstairs apartment.
Emigrant Bank, the parent of Emigrant Mortgage, said in written answers to questions from iWatch News that loan documents prove Mosunic knew in advance of the closing the amount of her mortgage loan.
The bank said withholding two times the amount estimated to complete repairs is "usual practice" and that Mosunic could have afforded the payments if the renovation had been completed. Then Mosunic would have received the rest of her loan and she could have brought in a tenant, the bank said.
But that didn't happen. The contractor she hired, at the broker Delaney's suggestion, took $70,000 and left the job half-done, she alleges in her lawsuit. She says back taxes and bills ate up most of the rest of the $150,000.
She made two mortgage payments. The foreclosure notice came in September 2008.
In the run-up to the housing collapse, millions of borrowers with bad credit bought homes that they couldn't afford and have since lost to foreclosure.