Florida Politician Faces Foreclosure and Disputed Mortgage Payments

While many politicians go out of their way to seem informed on the struggles of their constituents, the Miami Herald brings us the story of Erik Fresen, who has had a chance to experience these struggles at closer range than he would probably like.

Fresen is a representative in the Florida Legislature, currently positioning himself to become the Speaker of the state House of Representatives in 2014. Florida has been hit harder than nearly any other state by the now long-burst housing bubble, and Fresen is currently getting to take an up-close look at a system many of his constituents run up against every year. Erik Fresen’s home is in foreclosure.

According to records filed in a Miami-Dade County federal court, Fresen stopped making his mortgage payments more than a year ago. The lender behind Fresen’s mortgage, JPMorgan Chase, says the representative owes them nearly $615,000 split between principal, interest, and late charges.

Fresen reportedly says he’s the victim of sloppy record keeping. According to his account, the bank has insisted he owes them $10,321 to cover property taxes. Fresen says he did not pay his mortgage payments as part of a tactic to drive the bank back to the negotiating table on these taxes, which the representative says he has already paid.

A spokesperson for Chase, Nancy Norris, questioned the strategy. “Refusing to pay your mortgage isn’t going to bring us to the table any faster,” she said. “It’s bad for us and it’s bad for you.”

Fresen earns approximately $150,000 a year as a land-use consultant and legislator. He says he is able to make his mortgage payments, but was instructed not to as a part of the property tax disputes. His three-bedroom home is assessed at $484,648, according to the Property Appraiser’s Office for Miami-Dade.

Fresen’s home played a central role in his campaign for the House, as a symbol of his local roots. Fresen grew up in that home, which his parents sold, and subsequently purchased back and deeded it to him several years ago.

“It’s the classic meltdown with what happened with the banking system,” Fresen said. “No. 1, I had a bank that screwed up and charged me for tax bills I paid. No. 2, the bank fizzled out while they held my paper, and they got taken over by Chase. But Washington Mutual, (the bank that initially backed the mortgage) is still kind of processing things and departments aren’t talking to each other.”

Court records show that Fresen made his last mortgage payment on May 1, 2006, long before Washington Mutual was purchased by Chase.

Avi Shenkar, president of a company that represents borrowers who wish to renegotiate loans with their banks, believes that Fresen’s decision not to pay his mortgage payments is becoming more common. “It sounds kind of wacky,” Shenkar said of the situation. “It sounds like one that should be easy to fix.”

Fresen’s attorney says they have spent “hours” on the phone with Chase representatives with no resolution.

Norris, the bank’s spokesperson, disputes the suggestion that the change in ownership created problems with the system. “It’s still the same people processing the loan,” she said. Now, the matter will be resolved in court, with the politician making headlines of a sort he surely would rather avoid.

If you are facing mortgage problems, learn how filing Chapter 7 bankruptcy may help you keep your home and eliminate debt.