jess wisloski
return to investigative & exclusive

daily news logo

How one politician made a mess of her mortgage

BY JESS WISLOSKI

Thursday, April 3rd 2008, 4:00 AM State Senator Shirley Huntley

In the end, it was more a "faux"-closure than foreclosure.

An attention-grabbing experiment in financial brinksmanship by state Sen. Shirley Huntley has revealed her own ties to predatory lenders who have been the bane of her district.

Huntley announced on Feb. 27 she had deliberately defaulted on her mortgage to get a firsthand feel for her constituents' struggles. But by March 10 - a day before stiff penalties were to kick in - she bailed out, the Daily News has learned.

"I paid up to date. My attorney took care of everything," said Huntley, 69, who ponied up four months of payments worth about $8,000 and $2,000 in legal fees.

Her foreclosure flirtation made a splash in Crain's Business, The Observer and local weeklies.

But Huntley dropped it when "it made financial sense to save her from all the fees," said Ruben Wills, her chief of staff.

Property records also showed she had previously taken several risky loans from subprime lenders blamed for defaults in her Jamaica district.

Twice before, Huntley had narrowly avoided losing her home to foreclosure. She said those situations were created by unanticipated bills from family medical expenses.

But The News discovered she had refinanced her home with 10 lenders over 30 years.

Two of them - Delta Funding and Madison Home Equities - have troubled reputations, housing lawyers said.

"She obviously did business with at least two entities that have been the subject of extensive litigation," said Rick Wagner, litigation director at Brooklyn Legal Services.

Delta settled suits by the state and the Federal Trade Commission for breaking consumer protection and fair-lending laws in 1999 and 2000.

"It is a miracle to me that anybody would go there," Wagner said.

Legal Aid attorney Oda Friedheim, who has fought Madison Home Equities in court, agreed.

"Most of these are banks that specialize in subprime lending," Friedheim said. "Most of them are not good loans, and they make these loans in minority areas, where someone like even the state senator can fall victim."

Huntley's original mortgage in 1976 was $28,500. Three decades later, she owes $290,000 due to repeated borrowing against her home, property records show.

Huntley admitted, "I used my house as money" in the past. But the lenders were not the problem, she said.

"Frankly, I thought it didn't matter where you got a mortgage."

The recent experiment was to see what steps, if any, banks like her current lender, Wells Fargo, took to communicate with owners in default, she said.



return to investigative & exclusive