The Banks Must Be Regulated – NOW

From Mother Jones:

Soldier in Iraq Loses Home Over $800 Debt

Your money, your home - they steal it.

Banks = Crimminals

Capt. Michael Clauer’s homeowners’ association foreclosed on his family’s $300,000 house and sold it for $3,500.

— By Nick Baumann

Fri May. 28, 2010 3:00 AM PDT

Michael Clauer is a captain in the Army Reserve who commanded over 100 soldiers in Iraq. But while he was fighting for his country, a different kind of battle was brewing on the home front. Last September, Michael returned to Frisco, Texas, to find that his homeowners’ association had foreclosed on his $300,000 house—and sold it for $3,500. This story illustrates the type of legal quagmire that can get out of hand while soldiers are serving abroad and their families are dealing with the stress of their deployment. And fixing the mess isn’t easy.

Michael went on active duty in February 2008 and was sent to Iraq. After he shipped out, his wife May slipped into a deep depression, according to court documents. “A lot of people say that the deployment is more stressful on the spouse than the actual person who’s being deployed,” Michael, 37, says in an interview with Mother Jones. May Clauer had two kids to take care of—a ten-year-old and a one-year-old with a serious seizure-related disorder. In addition, she was worried sick about her husband. Michael’s company was doing convoy security in Iraq—an extremely dangerous job. “It was a pretty tough year for the whole company,” he says. “We had IEDs, rocket attacks and mortar attacks, and a few soldiers that were hurt pretty bad and had to be airlifted back to the States.”

Seeking to avoid hearing about the situation in Iraq, May stopped watching the news. She rarely answered the door, and Michael says he couldn’t tell her when he went “outside the wire”—off-base. May also stopped opening the mail. “I guess she was scared that she would hear bad news,” says Michael. That was why she missed multiple notices from the Heritage Lakes Homeowners Association informing her that the family owed $800 in dues—and then subsequent notices stating that the HOA was preparing to foreclose on the debt and seize the home.

In Texas, homeowners’ associations can foreclose on homes without a court order, no matter the size of the debt. In May 2008, the HOA sold the Clauers’ home for a pittance—$3,500—although its appraisal value was $300,000, according to court documents. The buyer then resold the house to a third person. (Select Management Co., the company that manages Heritage Lakes, declined to comment for this story.)

It wasn’t until June 2009 that May realized what had happened. Around that time, the new owner started demanding rent from the Clauers. She told Michael, who was still in Iraq. “At first I didn’t believe it,” he says. “I didn’t understand how someone can take your house and not give you anything for it.” When Texas Gov. Rick Perry visited Iraq in July, Michael says he told him about the problem. According to Michael, Perry called May and put lawyers in touch with the Clauers’ attorney, but couldn’t do much to alleviate the situation. (Perry’s office didn’t respond to calls seeking comment.) In August 2009, the new owner sent the couple an eviction notice, according to court records filed in the case. In Iraq, “the stress level was finally starting to come down,” says Michael, and he was “starting to see the light at the end of the tunnel.” He adds, “Then all of a sudden I get hit with this, and I’m trying to get out of there and get home and see what I can do to fight this.”

There’s more go read the rest.

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