MANATEE -- A new Connecticut company is crisscrossing Florida this week in hopes of getting stronger mortgage relief for homeowners with corrosive drywall -- and make some money in the process.
Chinese Drywall Recovery USA is holding several community meetings in Florida -- none in Manatee County or the Tampa Bay region -- and three other Gulf states. The aim: To organize homeowners, get support from local, state and federal elected officials, and persuade lenders to give drywall victims bigger breaks on their mortgages.
“Not only do these people have a toxic house problem, they have a toxic mortgage problem,” said Marina Campbell, who founded the Wilton, Conn.-based company last month.
Many U.S. homeowners have moved out of their homes because of the drywall, which emits foul-smelling sulfuric gases that corrode electrical and air-conditioning components. The drywall, most of it imported from China during the housing and post-hurricane reconstruction boom, also has been blamed for various health problems such as headaches, sore throats and runny noses.
As a result, some homeowners have struggled to pay both rent and a mortgage. Others have stopped making mortgage payments altogether, believing their homes are unlivable, unsalable and worth far less than what’s owed on them.
Campbell said she and her husband, John F. Campbell, know this from personal experience: The couple owns 20 rental properties in Louisiana that have sat vacant for more than two years because they have the defective drywall.
The only specific mortgage relief that Washington has offered such homeowners has been a six-month forbearance program for loans backed by Fannie Mae and Freddie Mac. It’s unknown how many Chinese drywall homeowners have gotten forbearances since the program began last July, as both mortgage finance companies said the information is not public.
Marina Campbell called that effort inadequate.
“I don’t think a temporary payment suspension or a small loan modification, such as reducing the principal by 5 or 10 percent, is going to make any difference,” she said.
What’s needed are larger, permanent principal write-downs, she said.
But lenders have paid little attention to Chinese drywall mortgages, primarily because they are just a small part of the broader foreclosure crisis, said John Campbell, who said he worked 20 years in the mortgage industry, primarily as a Wall Street trader.
“To expect them (banks) to focus on a small segment of their portfolio, I think, is unrealistic -- unless we give them some incentive to,” he said.
He’s hoping to do that by organizing homeowners through a series of public meetings in Florida, Alabama, Louisiana and Mississippi. The closest ones to Manatee are in Fort Myers on Thursday.
The Campbells also hope those homeowners hire their company to represent them in mortgage-modification negotiations.
The couple said they would not charge homeowners but would collect fees from lenders if negotiations are successful.
Calls to the Mortgage Bankers Association, a trade group, were not returned Tuesday.
The couple said they also have contacted local, state and federal elected officials, including Sen. Bill Nelson of Florida, in hopes of getting their support for a stronger federal mortgage-relief program.
A Nelson spokesman said he was unaware of the Campbells’ effort but that Nelson plans to soon meet with other senators about how to address Chinese drywall issues in the new Congress.
“(Nelson) certainly was pleased that Fannie and Freddie made the moves they made last year, and would welcome any other banks who decide to follow suit,” spokesman Bryan Gulley said.
Duane Marsteller, Herald staff writer, can be reached at 745-7080, ext. 2630.
