Hello. My name is Frank Latell and I am as about a regular guy as you can get. Years ago, I enlisted in the U. S. Navy and served 7 years as a commissioned Officer in the Civil Engineer Corps where my duties in the Public Works Departments and Construction Battalions, Seabees, landed me overseas. While serving in Scotland, I married an RN named Kathleen Swan; later we decided to raise our family in America and I became a licensed Professional Engineer and General Contractor.
I designed and built many single and multi-family homes including 390 apartment units.
We live in Southwest Florida, which generally caters their housing to tourists, whether weekly or monthly, and wealthy retirees. But my wife and I also worked hard to provide quality housing to low- and middle-income workers, many in the construction field.
Our properties were the Croix and Peppertree apartment complexes, with a total of 113 units, all at maximum occupancy and providing us with generous cash flow.
Then in 2007, real estate prices began to collapse throughout the United States and the world, but the great state of Florida was especially hard-hit. This led to a full-fledged financial panic by the fall of 2008. What followed was the most serious recession since the Great Depression of the 1930s.
Personally, some of my tenants lost their jobs and were unable to pay their rent. Due to eviction notices, a few tenants kicked holes in the walls and left their units a mess. After I saw what happened, I replaced management, and alongside my crew, ripped up carpets and replaced them with tile, patched and painted walls and went to work on repairing and renovating our units.
Prior to late 2006, multi-family rental housing in Southwest Florida was being bought, converted and sold (huge profits) as condominiums. Lending institutions, including Fannie Mae, provided overvalued loans on these properties. Due to the housing crash of 2007, value of these over-mortgaged properties had greatly declined and were in great financial stress. Although we did not refinance, we experienced the effects of loss of tenants and lower rents.
For three years, we put available funds back into our properties, where a small amount of additional money, other than the rents being generated by the apartments, had to be invested to meet the costs of rehabbing the units. Fortunately, we were not over-mortgaged as other similar properties.
In 2010, the commercial loan interest rates available in the open market were considerably lower than the rates we were paying on our Croix and Peppertree loans. We investigated and found that multi-family loans could be refinanced through loan modifications at a 3, plus or minus, percent interest rate for qualified candidates of excellent creditworthiness; we would have qualified.
When my wife and I had originally signed up for 10-year balloon Fannie Mae loans, little did we know that we would be falling into a deep, black hole of aggravation, embarrassment and financial loss.
Bailout Conspiracy: They Stole Your Money 