For Oriane and Norman Rousseau, their hopes of keeping the modest California house that had been their dream home ended with a loud noise while Oriane was in the kitchen.
She rushed to the bedroom, unsure of what had happened. But when the part-time nurse smelled sulphur, she understood. Opening the door Oriane saw her husband on the bed with his head wrapped in a blanket. “I saw blood on the wall. I lifted up the comforter a little and then I lost it,” Oriane told the Guardian in an interview.
Norman’s suicide on May 13 was the worst possible end for the Rousseau’s nightmarish experience of America’s foreclosure crisis. But it was a long, surreal and twisted journey to get there. It began in May 2009, when Wachovia, now part of Wells Fargo, told the Rousseaus they had missed a mortgage payment on their home in Newbury Park, an hour outside Los Angeles.
Even though the Rousseaus had made the payment – and had the receipt to prove it – that kicked off a foreclosure process they were never able to escape, battling against the seemingly careless bureaucracy of a major American bank that eventually took their home.
But the Rousseau tragedy is not alone. In America the foreclosure crisis roils on, devastating lives via a banking industry marked by such fraud and incompetence that five major banks – including Wells Fargo – earlier this year agreed a $25bn compensation settlement.
The numbers tell a story of ongoing pain. In the first quarter of 2012, the foreclosure rate jumped in 26 out of the 50 largest American cities. There are still around 2m homes with foreclosure filings in America, meaning millions of people will still likely lose their homes in the months ahead.
Legal papers filed by the Rousseaus against Wells Fargo reveal their tortuous foreclosure experience and the devastating toll it had on their lives. Yet their story began in the most the ordinary way.
German-born Oriane, 61, had met Norman, 53, who worked as an ATM technician, 15 years ago at a nearby country and western bar. They both loved music and dancing. “It was love at first sight,” Oriane said. “We got a house and we tried to make a little dream home.” The pair eventually married, buying their house in March 2000, and paying a 30% downpayment. In October 2007, they were approached by a Wachovia loan officer to refinance, being assured they could reduce monthly payments and that house prices were rising. They agreed and continued to make their loan payments in person each month.
But in May, 2009, they received a statement saying April’s payment had been missed. The Rousseaus faxed off repeated copies off the receipt they had got from the teller and continued to make payments of $1,615. But they started getting phone calls – as many eight a day – from Wachovia’s collection arm. On August 8 they spoke to a Wachovia officer, called John Nickells, who apologised and said their account was current.
Two weeks later they received a letter now asking for a payment of $3,487. The Rousseaus hired a lawyer who examined their refinancing loan and found numerous irregularities, including a vastly inflated estimate of the Rousseau’s earnings that had been made – not by the Rousseaus – but by the Wachovia loan salesman. Yet they continued to make their payments each month, even as the bank continued to send foreclosure warnings.
But in September, 2009, the local Wachovia branch refused to take their monthly payment in person as the Rousseaus had applied to have the loan terms adjusted. The Rousseaus insisted on sending a cheque by mail. They attempted to speak to officials from the bank but on the phone could only get “Ken” or “Mary” in bank call centres.
Each one always told a different story, or insisted certain information needed to renegotiate their loan had not been received, even though the Rousseaus’ lawyers had sent it, often multiple times. “Every time we talk to someone they did not know what the person did before them. Or they did not care. It was like talking to a wall,” Oriane said.
By December 1, 2009, the bank stopped accepting the Rousseau’s payments by mail, saying their loan modification application was still under review. Repeated calls for a decision met with little reaction. Then on May 26, 2010, Wachovia said the Rousseaus were not eligible and in June demanded $17,000 to make up for payments owed: including payments the bank had earlier refused to accept. A new lawyer got the Rousseaus a reinstatement deal.
On November 17 the Rousseaus were informed they would be foreclosed on unless they paid a debt the bank now said added up to $26,000, including $4,000 of late fees. They had two days to pay. Amazingly, the Rousseaus – by draining a retirement fund – tried to pay. But they could not do it quickly enough due to account limits on cash withdrawals. On November 22 Wells Fargo acquired the title of their house.
Throughout 2011 the Rousseaus fought on in the courts to reclaim ownership. By July, they got a injunction as long as they could make a monthly payment of $1,800. But by then, financially drained by legal fees and in the wake of Norman losing his job, they were struggling. They failed to make the December payment. Wells Fargo went to court and a lockout was set for May 15, 2012.
In order to keep a roof over their heads, Norman bought an old motor home on Saturday, May 12. But the vehicle’s engine did not work. He struggled to fix it. Then, at midnight, he gave up and went to bed. That Sunday morning he shot himself dead. The Rousseaus’ lawyer, Chris Gardas, believes that broke him. “Once he could not fix that thing, I have no doubt that was the last straw,” Gardas said.
Oriane is in deep mourning. “He saw no way out,” she said. But she is also angry, and her lawsuit is going on without her husband. She says she is doing it for the many other Americans caught in foreclosure hell battling gigantic financial institutions who seem keener on foreclosures than letting people stay in their homes. “This cannot happen to someone else. It cannot. These banks are greedy, they are money-hungry and they are lying,” she said.
A local activists group, the Alliance of Californians for Community Empowerment, is helping her tell her story. Peggy Mears, an organiser for ACCE, said she was horrified at the case. “Can you imagine what he felt like? Norman had no more fight left in him. For him death was better than fighting that bank,” Mears said.
Oriane is now starting to speaking out on California’s plans for a Homeowners Bill of Rights, which would help homeowners renegotiate loans or establish a single point of contact for dealing with banks about their cases. These are things, Oriane believes, that could have saved her husband. “It does not bring my husband back but maybe I can do something for this country,” she said.
For its part, Wells Fargo says it is not to blame. “Despite current reports, we tried repeatedly to find affordable options for the family,” a bank spokeswoman said. Wells Fargo still intends to evict Oriane, though it has temporarily suspended proceedings. Not that she can face a night in the place she once thought a slice of the American dream. She is currently living in a motel paid for by a church. That money runs out on Friday.
“I have no idea where I am going to go. I have been left with nothing,” she said.
• We’re asking homeowners who have faced foreclosure in the U.S. to share their stories with Guardian readers.
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