Man who never missed a mortgage payment but lost home gets a trial

Atta Poku's first mortgage wasn't properly paid off after refinancing

  • Kwaku Atta-Poku's home was foreclosed despite the fact he never missed a mortgage payment.
Kwaku Atta-Poku's home was foreclosed despite the fact… (Baltimore Sun photo by Algerina…)
February 01, 2011|By Larry Carson, The Baltimore Sun

For more than four years since he lost his Columbia home to foreclosure — despite never missing a mortgage payment — Kwaku Atta Poku has fought a legal battle for financial stability and personal vindication.

After several legal setbacks, a federal judge's ruling has given new hope to Atta Poku, who built a small taxi business along with a new life in America — only to watch as it was ruined by a mortgage nightmare that all agree he was not responsible for.

"Thank God. Finally, somebody …" Atta Poku said Tuesday when he learned of the judge's ruling. "I'm hoping something good will come out of that. This is the first time I had some level of good feeling about the [legal] system here."

The Ghanian immigrant has lost lawsuit after lawsuit, mostly on technicalities that did not address allegations that his 2001 refinancing loan was mishandled, leading to the foreclosure. His experience helped spark changes to Maryland's foreclosure laws, but those changes came too late to help him.

U.S. District Judge Richard D. Bennett ruled Monday that Atta Poku, who lost his home to foreclosure in 2005 and was evicted the following August, is entitled to a trial. Atta Poku says in court papers that his first mortgage was not properly paid off by the bank that gave him the new loan.

The actual fate of the refinance money was never proven. But since Atta Poku couldn't prove the first mortgage was paid off, he lost his house.

A win in court later this year could help Atta Poku recover financially — he's seeking up to $34 million in damages and compensation — but he knows he'll never get the house back.

Atta Poku's troubles began with a refinancing of his Powder Run townhouse in 2001, before the national economic crisis. A refinancing involves a new mortgage. The mortgage loan is used to pay off the original debt, but in this case, that never happened. The original mortgage was for $97,500.

Though he never missed a mortgage payment and sometimes paid extra to reduce his debt, Atta Poku lost the house to foreclosure in February 2005. The house was sold the following month. After he realized how serious the problem was, Atta Poku retained Ellicott City attorney Gerald M. Richman, who represented him for free — but he was evicted in August 2006 and was never able to reverse the foreclosure.

But now, in a suit challenging the refinancing failure rather than the foreclosure itself, Atta Poku's attorney C. Scott Borison is making some headway via a suit originally filed in Baltimore City Circuit Court in December 2007. Washington Mutual, the original defendant, moved the case to federal court before the company's financial troubles led to a Federal Deposit Insurance Corp. takeover.

Judge Bennett denied an attempt by the FDIC to again use technical issues to dismiss Atta Poku's latest complaint. Greg Hernandez, a spokesman for the agency, said there would be no comment on a pending legal matter.

"Atta Poku has clearly not been given a full and fair opportunity to be heard on the issues he raises in this case. He has been diligent in appealing the foreclosure proceeding decided against him, yet he has received no substantive review of that decision as a result of his appeals being dismissed because of procedural failure," Judge Bennett wrote in his 15-page opinion.

A trial is scheduled for August 22, Borison said.

The financial institutions argued that the case has already been argued and under the law should not be considered again, but Judge Bennett said that Atta Poku's case now is not about the foreclosure itself, but involves handling the refinancing loan, and so qualifies as a separate case.

"After a long wait, he may now have a remedy for the injustice caused by a large, now defunct bank, that was at best, incompetent," Borison said.

Borison had repeatedly argued that Atta Poku never touched the refinancing check and was not at fault in any way. Even the title company involved in the refinancing agreed in a court hearing on the case Jan. 20 that Atta Poku did nothing wrong, Bennett said.

Atta Poku's problem resulted from the bank's failure to make sure that the refinancing loan was used to pay off the original mortgage. It took Washington Mutual three years to discover the error, and by then no one could tell for sure exactly what happened to the money, partly because some bank documents were lost. Under the law, however, Atta Poku was responsible, so WaMu foreclosed on his house.

Atta Poku has said he never took WaMu's initial claims seriously because he knew he had paid every month and had done nothing wrong.

By the time Atta Poku moved to reverse the foreclosure, it was too late. Later, when he tried to appeal, he was told that because he could not afford a required cash bond, his appeal was dismissed.

He survived with the help of friends and homeless prevention groups for several years, but is now on his own, living in Long Reach, he said, and barely making ends meet.

"The business went dead," he said, and he lost his taxi license for a time because he had no local office, which is required. But Kimco Realty rented him an office in the half-empty Wilde Lake Village Center and he has one regular client who has him on retainer to drive the family's elderly parents.

"I'm barely getting there, but it's working," he said. His wife and their four young children are with him and a grown daughter from an earlier marriage who had left because of his financial problems has reconciled with him, he said.

"I'm doing here and there," he said, hanging around downtown Washington and Baltimore and Silver Spring to find fares. "I need business to hold on to everything I've got," he said.

larry.carson@baltsun.com

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