the indy star has a much longer, more detailed story up than the one i linked to last night:
To dupe the buyers, the suit alleges that Penn's mom and sister recruited potential buyers, checked out their credit and rushed them through the signing of loan documents. They required no payments from these buyers, promised them cash payments in return and assured them that they would not own these homes or be liable for the mortgage payments.
But the buyers were liable. And the documents they signed were key for the Penns to convince Countrywide to shell out hundreds of thousands of dollars, Countrywide claims.
That second part of the scheme hinged on Robert and Amy Pollard, loan officers for People's Choice of Kentucky, according to Countrywide's lawsuit. The Pollards' attorney did not return a call for comment.
People's participated in a program with Countrywide called correspondent-lending, in which Countrywide promised to quickly buy newly written mortgages, so long as they were written according to predetermined guidelines. Such mortgages accounted for about 38 percent of Countrywide's $296 billion in residential lending during the first eight months of this year.
The Pollards got loans to cover 80 percent of the home purchase by submitting documents that showed the buyers had access to cash in bank accounts that would cover the remaining 20 percent. In reality, those bank accounts at Union Federal and National City banks were controlled by Robert Penn, Countrywide claims.
For Penn to make the operation profitable, he got three Indianapolis-area appraisers to say the homes were worth more than what Penn paid to acquire them, Countrywide claims.
Ace Appraisal Services of Greenwood, Pinnacle Appraisal Services and Bauter Appraisal Services all participated in Penn's scheme, Countrywide claims. Those companies did not return calls seeking a comment.
Countrywide discovered the scheme, it says, because it noticed so many homes in the same three neighborhoods going into early default.
the star also has another piece that analyzes the neighborhoods where penn bought all those houses:
All three Indianapolis-area neighborhoods hit by the alleged mortgage fraud are practically void of inhabitants, including one on Indianapolis' Eastside that has the look of a place defeated.
At the two others -- town home developments in up-and-coming Westfield -- construction workers are still putting the finishing touches on units that are selling for $180,000 and up.
Fewer than two dozen addresses there were listed in Countrywide Home Loan's lawsuit, half in the nearly 100-unit Oak Trace project, half in Andover Place.
But the Eastside neighborhood of Windsor Village is a much larger mess. The lawsuit names 172 addresses from the neighborhood.
172 addresses in one poor neighborhood, most of them uninhabited. row after row of empty houses, with mortgages in default, "owned" by people in virginia who've never even been to indiana. as the article points out, the virginians who got stuck with the mortgages weren't the only ones who were screwed over here: windsor village is now a "ghost town".
Deborah Mathis, 29, who lives in one of three neighborhood duplexes owned by another of the alleged Martinsville victims, said the place is a pit, and she's looking to move.
"My shower wall fell in, and it's bug-infested," she said. Her stuff is boxed up on the living room floor so she can move quickly when she finds something better for her, her daughter and nieces and nephew.
Often, empty houses are magnets for homeless squatters or drug activity. The house across the street shows signs of such habitation -- some bedding strewn on the kitchen floor. The front doors of other houses are ajar.
Mathis said she has seen none of that. Still, she doesn't let her children walk to the bus stop, even though it's just a block away. "I drive them," she said. "Just being careful."¶
