LOS ANGELES (CN) – An elderly couple claim in court that real estate agents bilked them into using their home as collateral for a new church.
Erma and James Marshall and the Mt. Zion Missionary Baptist Church of San Bernardino sued Dan Bochner and Rolando DeArmas (also referred to as DeArmis in the complaint) and Bochner’s foreclosure agent Reliable Trust Deed Services, in a federal RICO complaint.
The Marshalls, with “ages exceeding 74 years,” claim that in 2005 DeArmas tricked them into signing over their home as collateral for the purchase of a movie theater in San Bernardino, which the couple intended to use as a church.
After the property was purchased, mortgage payments fell into arrears and the Marshalls’ home was entered into a foreclosure sale, the couple says.
They claims the Mt. Zion board of directors was “forced” to take out a $1.4 million loan from Bochner, a “‘hard money’ lender,'” after failing to secure financing from conventional sources.
Bochner and DeArmas then pinpointed church officials’ homes as collateral for the property, according to the complaint.
“DeArmas knew that plaintiffs, Marshalls, were an elderly couple who were unfamiliar with real estate transactions and could easily be tricked and convinced into signing documents for their residence to be used as collateral for the Del Rosa church property,” the complaint states.
“Defendant DeArmas, acting as the agent for Bochner, conspired with Bochner to concoct a scheme by which they fraudulently induced plaintiffs, Marshalls, to execute a deed of trust on their residence as security for the hard money purchase loan from Bochner.”
The Marshalls say that they and other church officials were then invited to a meeting at First American Title Co., where they told DeArmas that they “would not under any circumstances allow their residence to be used as collateral for the purchase of the Del Rosa church property.”
“DeArmas assured them that in signing the legal documents, their residence would not be used as collateral for the loan in the purchase of the Del Rosa Church property,” the complaint states.
The Marshalls say they agreed to sign the documents as chairman and head deaconess of Mt. Zion, without signing any personal guarantee and based upon assurances that they would not have a personal obligation to a promissory note, or “be subjected to any security agreements or risk of foreclosure.”
“DeArmas failed to provide the Marshalls with copies of the documents they signed under the guise that he needed to record the Deed of Trust in Orange County, California before the end of the day,” the complaint states.
“Upon information and belief, due to some difference of opinion or confusion as to whether Mt. Zion or the seller of the Del Rosa Church Property was responsible for the initial mortgage payments, those mortgage payments fell into arrears from the very beginning.”
The Marshalls say that in the summer of 2006, they received a notice of default and discovered that despite the defendants’ representations, their home had been used as collateral for Del Rosa church. They say their home was scheduled for a foreclosure sale later that year and they “incurred damages in their efforts to stop the sale.”
The Marshalls seek cancellation of instrument and damages for RICO fraud, negligent misrepresentation, usury, and elder abuse.
They are represented by Greta Curtis.