Bank agrees to pay off widow’s subprime loan
Two weeks ago, National City Bank agreed to pay off 78-year-old June Waselchalk’s subprime mortgage loan.
“My lawyer called me and told me we got rid of that old mortgage,” the Fayette County coal miner’s widow said. “I said, ‘Praise the Lord!’ I was afraid I was going to die paying on that thing.”
On a fixed income, in eight years, Waselchalk paid more than $44,000 on a $47,500 mortgage refinancing loan with a 10.75 percent interest rate. Yet she still owed about $41,000 in principal alone.
National City Bank was sued earlier this year on her behalf by Mountain State Justice, a Charleston non-profit law firm. They owned her loan at the time because they bought Provident Bank, which made the loan. “They didn’t make the loan, but they decided it was the right thing to do,” her attorney Dan Hedges said.
Next Wednesday, the House of Representatives will vote on a bill intended to prevent unaffordable loans like Waselchalk’s from happening in the first place.
“And there are many things in that bill that would do that,” Hedges said. (see accompanying story)
Last month, Waselchalk told her story in a Sunday Gazette-Mail special report on predatory mortgages. In 1999, she said, a man from a Charleston mortgage company, Solution One, came to her Sewell Mountain house and convinced her that her monthly mortgage payment would be lowered if she refinanced.
Instead, her payment doubled to $417 a month.
But a new amendment — inserted last Tuesday — would make it impossible to sue the holder of the loan to have the loan declared void, if they are not the first owner. It also does not allow penalties against the holder, as state law does.
“They’re making it near-impossible to save the house when people break the law,” Hedges said. “And removing incentives to follow the law.
“And that means that we would be severely limited in our ability to help people like June Waselchalk.”
To contact staff writer Kate Long, use e-mail or call 348-1798.