Jackson County foreclosure auction brings tears, questions
Clara Carrera hugs a friend after Prosperity Bank won the bid on their own foreclosure auction. Clara and Jose Carrera purchased a home from Glenn Whitley on a contract for deed arrangement. Whitley later made and defaulted on a loan against that and other properties.
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HOW TO MAKE SURE THIS DOESN'T HAPPEN TO YOU
Want to avoid something like this happening to you? Brian Rogers, a partner with the Victoria law firm Rogers, Davis, Hroch, LLP, offered some advice:
If you buy on a contract ...
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HOW TO MAKE SURE THIS DOESN'T HAPPEN TO YOU
Want to avoid something like this happening to you? Brian Rogers, a partner with the Victoria law firm Rogers, Davis, Hroch, LLP, offered some advice:
If you buy on a contract for deed, pay a title company to do a title search. That can reveal certain things, such as whether the person selling the property actually owns it.
Go to the courthouse and record the contract to deed. It lets people know you have an interest in the property and banks will not make loans against it.
EDNA - The Carrera family stood frozen, their gazes fixed on J. Milton Chapman, the man in the blue button-down whose next words could lose them their home.
"Do I have any other offers?" asked Chapman, a partner with the law firm Anderson, Smith, Null & Stofer in Victoria.
The crowd remained silent as Chapman asked again.
Paola Salgado, 16, held back tears while her 7-year-old sister, Lupita Carrera, kicked her feet in a nearby chair.
With the one and only bid, the home went to Prosperity Bank for $124,920, while Clara Carrera, a smile spreading across her face, made the sign of the cross.
Although the family thought they had paid off their Edna home a year ago, a series of events put them in the precarious position they found themselves in Tuesday.
It began in September 2000, when Clara and Jose Carrera decided to purchase the home off County Road 306 near Edna from James Glenn Whitley.
They entered a contract for deed, meaning once they paid it off, the property was theirs, said Bobby Bell, Jackson County district attorney. The family paid the $53,000 they owed for the 10-year contract two years early.
The family approached Whitley and asked for the title, Clara Carrera said, but Whitley always said he was working on it.
"We waited three or four months," she said. "We waited and waited, but he never answered."
The Carreras got their answer when the bank sent them a note in the spring alerting them of the pending foreclosure.
Whitley had approached Prosperity Bank in 2006 and pledged the property. When he filed for bankruptcy, he listed the Carreras as leasees, limiting their legal rights, Bell said.
The bank isn't the bad guy, Bell explained to the crowd gathered to support the family. It took the deed of trust on good faith and, as far as Bell knew, planned to work to make sure they were able to stay in the home.
That house means a lot to them, too.
Jose Carrera and his 14-year-old son, also named Jose Carrera, added their own touches, building on a living room, car port and even remodeling the bathroom, the younger Jose said.
"We did it ourselves," said the teen, clad in a white button-down shirt and khakis.
Family and friends surrounded the Carreras Tuesday to offer moral support.
"We're going to save this house," family friend Danny McBride said. "If I have to buy it myself, we're going to save this house."
The Carreras' property wasn't the only one up for sale. Jerry and Stacey Berry's home also went to auction. They too had been duped by Whitley.
The couple paid $10,000 down for property they purchased from Whitley and paid $1,280 a month, Bell said. Of that, $200 was to go for taxes and insurance.
When a grass fire on the Berrys' land damaged a neighbor's shed, they went to collect insurance money, said Brian Rogers, the family's attorney. The problem? There wasn't any insurance.
Whitley didn't own the property when the family purchased it, Rogers said. After Whitley received the $10,000, he purchased it from someone else, Bell said, but never paid the insurance.
Whitley borrowed the money to make the purchase from Bill and Miriam Ackley, who acted as private lenders, Rogers said.
Like Prosperity Bank, Bell said, the Ackleys are not to blame, but had to continue on with the foreclosure filings. As Bell spoke, Jerry Berry held one arm around his wife, while patting Bill Ackley on the back with the other.
When Whitley filed for bankruptcy on the property, there wasn't much the family could do.
When the home sold for $60,400, the couple quickly, but silently, left.
A representative from the Houston law firm Baker & Associates bid on behalf of an undisclosed client. That client was later revealed as BK/HSH LLC, a company owned by Reese Baker, a partner with the Houston firm, Rogers said. Documents filed with the secretary of state's office show BK/HSH LLC has the same address as Baker & Associates.
"It doesn't look right, it doesn't smell right," Rogers said of the purchase.
By Tuesday afternoon, the company had contacted the Berrys about repurchasing the property, the attorney said.
Rogers said he plans to fight his clients' eviction, if it comes to that.
Calls to Reese Baker and Prosperity Bank were not returned Tuesday afternoon.
In the meantime, it's up to Bell to decide what happens next, Rogers said.
Bell told the crowd that if those purchasing the homes were making innocent purchases for value, he had no problem with that. If crime is involved, however, that's another thing.
Rogers said the family testified against Whitley in a recent criminal trial.
"Did this corporation target the Berrys because of their testimony?" he asked. "There's a lot that doesn't make sense."
During the trial, Bell said, Whitley admitted he defrauded the Carrera and Berry families.
Whitley was indicted on March 7, 2008 and convicted of aggravated sexual assault of a child, according to records at the Jackson County District Clerk's office. He was sentenced to life in prison and fined $10,000.
As for the Carreras, the bank may have purchased the home, but that's what they hoped would happen. Now, they said, they can begin working together for a solution so they can keep the house.
Pastor Andy Schroer, a friend of the Carreras, said he hopes he and the Carreras' supporters can do something to help the Berrys.
Comments
The corporation purchased the property for 100 cents on the dollar. Ackley would have had to have bid on the property above the payoff, which means turning cash over to Whitley. That is the last thing anyone wanted to do.
September 2, 2009 at 3:31 p.m.I agree with you about having to forclose on the property, however Mr. Ackley did not have to sell it. Just because a property is forclosed on does not mean it has to be sold. Mr. Ackley could have simply kept it and made arrangements with the Berrys to keep them in the home. The title returns to the owner of the property, Mr. Ackley in this case. This is not hard to understand if you have any knowledge of real estate. Mr. Ackley did not have to sell the property to another investor. He could have easily refused the sell. He didn't. Sounds like he didn't want the property anymore.
September 2, 2009 at 3:20 p.m.I have to reiterate speechfree...obtain the representation of a Texas Realtor and advice of an attorney prior to getting involved with any real estate transaction(s). These situations would have initially sent up "red flags".
September 2, 2009 at 1:48 p.m.gtfs2009 - you do not understand the nature of the foreclosure sale. Mr. Whitley had title to the property encumbered by the lien that Mr. Ackley held. In order to get the property or the money back, Mr. Ackley had to foreclose on the property. Otherwise Mr. Whitley would continue to hold title to the property. It is exactly the same for Prosperity Bank, if they had not foreclosed, Mr. Whitley would still have title to the property.
September 2, 2009 at 1:05 p.m.bwr5000,
September 2, 2009 at 12:04 p.m.It sounds like you have the inside scoop on this situation. The fact is that Mr. Ackley did not HAVE to sell. No one forces a forclosure property to be sold if it is owned by a private party. That is a choice Mr. Ackley made on his own. He could have kept it and arranged an agreement with the Berrys. Did it actually go up for auction or was it sold before hand might be a question to ask someone. I agree with speechfree, make sure everything is in writing and cleared through a title company. I am sure Mr. Ackley took care of that prior to making an investment with Whitley, wouldn't you to protect your investment? Banks don't want the property, they want money. There is a difference.
gtfs2009 - Mr. Ackley was in the same position as Prosperity Bank. Mr. Whitley borrowed money from Mr. Whitley to purchase the properties, which he sold to the Berry family. The caveat to the situation is that Mr. Whitley actually sold these properties before he had purchased/borrowed the money from Ackley to purchase. Mr. Ackley had to foreclose to get the property back just like any other lending institution would, and in this case, like Prosperity Bank did. He was not a partner with nor in no way connected to Whitley. The only difference in relation to the Prosperity Bank foreclosure is that the company from Houston, BK/HSH, LLC , a company owned by Reese Baker, who was Whitley’s bankruptcy counsel in both cases, stepped in and bought the Berry property at the foreclosure sale. Mr. Ackley could not prevent what happened at the sale. If BK/HSH, LLC had not purchased the property back, then there would have been an agreement reached between Mr. Ackley and the Berry’s. BK/HSH, LLC prevented that agreement from occurring.
September 2, 2009 at 10:04 a.m.What a horrible thing for these families. I sure hope they are worked with so they can keep their homes. Mr. Whitley...you're going to have to answer to the Almighty for what you've done to this child and these people...You should be very afraid.
September 2, 2009 at 9:43 a.m.If I am not mistaken, Mr.Ackley did not need to continue with his forclosure procedings. How did Mr. Ackley get involved to begin with? Is he an investor with Glen Whitley? Why didn't he offer to sell his house to the Berrys? Why did he allow another party to purchase it? I understand with a forclosure that the property gets returned to the financing company, or in this case Mr. Ackley. If Mr. Ackley wanted to help the Berrys why did he sell it? Mr.Whitley was unable to continue paying for the property therefore it was foreclosed.
September 2, 2009 at 9:35 a.m.I am relieved to know that the Carrera's did not lose their home and that Prosperity Bank is working with them.
I have purchased land in the methods mentioned, but in every case had an attorney review the contract for deed, researched the property history for taxes and liens and been fortunate to have had success. The culprit and bad guy is definitely Whitley. Perhaps his intent was good at the time, but we know what the end result is. People like this need to be caught and put away. If you have a "contract for deed", do yourself a favor, have an attorney review it, and go to your local tax (appraisal) office and inquire about the property. Also, if you personally don't have the insurance on your property, find out who it is insured through and contact them to confirm.
September 2, 2009 at 7:29 a.m.My heart goes out to the Carrera's and the Berry's and I wish them well. The next step is difficult and is in Mr. Bell's hands. The bank now has the home and maybe just maybe they could open up their hearts rather than the vaults of money and work with the family in these difficult times.
Thank you, Lord, for giving Mr. Whitley what he deserves. May he be forgiven AFTER his life sentence.
September 2, 2009 at 2:45 a.m.This is a perfect example of the need to seek professional advice from both attorneys and Realtors when making a land deal. I know it is temping thinking you are avoiding commissions and fees , but these fees provide valuable services such as a title policy that provide consumer protections.
September 1, 2009 at 8:28 p.m.