David & Goliath in a Minneapolis neighborhood
A Minneapolis neighborhood took on a lending corp - and won.
In yesterday’s Star Tribune, I read about how the neighborhood of Hawthorne shook down the likes of CitiMortgage. I don’t know about your neighborhood group, but none of the ones I’ve been involved with had that kind of bravado.
Here’s the skinny:
Hawthorne was able to buy a fire-damaged house for under 19K. It’s a property which CitiMortgage was in for a $235,000 mortgage. I think it’s saying something that a lending giant is taking some small amount of responsibility for its poor lending practices.
From the Star Tribune article…”We shook the foundations of a financial institution that, like the rest of corporate America, claims to do no wrong,” said Peter Teachout, a neighbor of the house and the chairman of the Hawthorne Area Community Council, which sued CitiMortgage.
Although the piece clearly states that the case “avoids a precedent on whether a lender can be held liable for the effects of allegedly careless loans” - it is a huge victory for this neighborhood which needs the property for part of a redevelopment project.
Tags: citimortgage, Hawthorne, Minneapolis, Mortgage