Louis Manley spent most of his working days as a doctor. But when Deutsche Bank started to foreclose on his Clearwater condo last summer, the 81-year-old Manley branched into a new field.
"I'm calling myself a student of the law,'' he says.
Frustrated that the bank wouldn't consider a loan modification, Manley set out to challenge the foreclosure. He pored through legal tomes at the Stetson University College of Law. He prowled the Internet for tips on defense strategies. He filed motions and memorandums, citing everything from the Declaration of Independence to a 1994 workbook of the Federal Reserve Bank of Chicago.
Manley even spent $200 on certified letters to make sure the bank's attorneys couldn't claim they never received his correspondence.
Alas, it all appeared for naught May 7 when the bank bought his Top of the World condo for $100. But Manley, a World War II vet, remains unvanquished.
"I am fighting on,'' he vows.
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Like Manley, a tiny but growing number of the 2.1 million Americans facing foreclosure this year are aggressively battling to save their homes. And those unable or unwilling to hire lawyers are representing themselves in court.
They are getting plenty of help. Web sites like Consumer Warning Network and Livinglies offer sample letters and motions, glossaries of legal terms and summaries of favorable court rulings. A popular series of how-to books now includes Foreclosure Defense for Dummies.
And for those willing to pay $149 for an afternoon of tips, encouragement and sympathy, there are seminars like the recent one in Orlando.
"Don't get hung up in your mind that this is your fault,'' Brad Keiser tells an audience of 30 homeowners, some from as far away as Colorado. "There are police chiefs, college deans, retired nuns — people in all walks of life are in a situation like you are in.''
Keiser, a former banker, and Neil Garfield, a lawyer who founded Livinglies, originally held all-day seminars just for the legions of attorneys now moving into foreclosure defense work. But sensing demand, they decided to offer a pared-down version for lay people.
Their over-arching theme is that people who got loans they couldn't afford between 2001 and 2008 are victims of a securitized-loan frenzy in which investors, eager for big returns, poured trillions of dollars into the credit markets. Much of that money was used to fund the high-interest but risky loans now in default.
"I say to you, you have every reason to be restored to the position we were in before you were the victim,'' Garfield tells the group. "You have every right to have terms and interest rates that are affordable.''
For the next four hours, he and other speakers offer tips on what questions to ask and what action to take so that the party seeking to foreclose will either give up or agree to a loan modification. "Challenge everything'' is a strategy that some audience members said they had already used with success.
Tales from the front
Even before he defaulted on a rental property, Vladimir Diaz of Broward County started "to educate myself'' with information he found on the Livinglies Web site. So he knew how to challenge IndyMac Bank when it filed a notice of foreclosure even though it didn't own the loan "note'' — the borrower's obligation to repay.
"I got up at the hearing and said, 'Your honor, they don't have any standing to foreclose,' " he recalls. "She liked that'' and dismissed the case.
Homeowners are warned, though, that they must follow proper procedures when representing themselves, such as getting on the judge's calendar and notifying all parties of motions. If that sounds too daunting, they can consult the Livinglies site for a list of attorneys who do foreclosure defense, at a price.
Cautions Garfield, who gets no referral fees: "You don't want to go from a predatory lender to a predatory lawyer.''
Despite a record number of foreclosures, judges in the Tampa Bay area say very few homeowners are representing themselves in contested cases.
"With all these seminars and Web sites, we keep our heads down, wondering where is the first incoming wave?'' says Hillsborough Circuit Judge James Barton. "But so far I'm just not seeing it.''
Pinellas Judge W. Douglas Baird recalls a few cases in which "homeowners were throwing up whatever roadblocks they could (to delay) the inevitable.''
In general, though, "when they come in at all, usually they're resigned to what's going on,'' he says. "They're just wanting to understand what's going to happen and how to deal with the ultimate sale or what options they have in trying to redeem the property.''
For Manley, a doctor of osteopathic medicine, the battle to save his condo had its roots 15 years ago when he was diagnosed with cancer of the nasal passages. Told he had six months to live, he closed his practice and spent much of his savings on what turned out to be successful surgery at the Mayo Clinic.
After his wife died and the interest rate on their $120,000 loan increased, Manley found that his $1,500 a month in Social Security was not enough to pay the mortgage and other bills. He missed several payments, and Deutsche Bank started foreclosure proceedings in July.
Still spry and sharp, Manley promptly went to work, trolling the law libraries at Stetson and the county courthouse and "talking to people coast to coast'' about ways to fight back. Using a common foreclosure defense strategy, he demanded that the bank answer a series of questions, though some of his phraseology was a bit perplexing:
"What exactly could be implied from evidence used by: Three State Attorney Generals sue lenders … for misrepresentation, discrimination etc?"
Based on other information he thinks he plucked from the Internet, Manley also tried to dismiss the case on the grounds he had been denied his "right'' to a written transcript of a hearing. Judge Linda Allan dismissed his motion, noting that "there is no right to a transcript in a civil matter.'' (The party requesting one must hire a court reporter and pay for the transcription.)
Though the sale initially was set for late last year, the bank agreed to postpone it to give Manley time to make up his late payments, which he didn't have the money to do. The bank bought back the condo this month.
Like other judges, Allan encourages lenders and homeowners to work out settlements through mediation. She couldn't discuss Manley's case because it is still open — he recently filed a motion to set aside the sale. However, he moved out all his furniture and is staying with a friend downstairs.
"He can't hear and I can't see so we help each other,'' she says.
Manley knows he may eventually have to move in with one of his children. He remains convinced he didn't get a fair shake in court because the bank won a final judgment of foreclosure without having to answer his questions. But he's also convinced he's done a good job representing himself.
"Absolutely,'' he says. "I think I've done my homework."
Susan Taylor Martin can be contacted at firstname.lastname@example.org