A television ad promised Maria Alarcon Garcia and Julio Romero
the home the young couple dearly wanted.
Gilroy – A television ad promised Maria Alarcon Garcia and Julio Romero the home the young couple dearly wanted. It seemed a distant dream in pricey Gilroy – especially for a farmworker and a repairman with two little girls – but they dialed the advertised number and an agent said yes, the dream could be theirs.
Guided by a woman they trusted, a woman who spoke their language and cooed at their children, they signed a stack of English-language contracts, none of which they understood, they said.
Eighteen months later, their home is in default, their credit cards are spent and their trust is shattered.
“We never thought she’d cheat us so,” said Romero, sitting alongside his wife in their spic-and-span kitchen. “Now, we’re traumatized. The money is gone. Our kids ask us, why don’t you buy us this, or this? And all we can say is, ‘Someday. Someday.’ ”
The couple claims the English-language purchase contract they signed in November 2005 pushed them into a mortgage costing $2,000 more per month than the payments that Maria Avila, owner of Rancho Grande Real Estate in Morgan Hill, had led them to expect.
Avila’s name may ring familiar: The Spanish-speaking agent has already been linked to another predatory lending case in Hollister. Strawberry pickers Alberto and Rosa Ramirez claim Avila scammed them by promising to refinance their $720,000 Hollister home – a promise they say was never fulfilled, and now leaves the home heading for foreclosure.
The Morgan Hill agent denies the allegations, and those made by Garcia and Romero. Nearly 20 years ago, Avila emigrated to the U.S. from Colombia, fleeing the Mafia, and worked her way up from waitressing and shining shoes to owning her own real estate business, Realty World Rancho Grande, now Rancho Grande Real Estate.
Ninety-nine percent of her clients are Spanish-speaking, she said, and prefer her office, which doesn’t look down on clients for the way they dress or the language they speak. According to the California Department of Real Estate, Avila has never been disciplined in response to a customer’s complaint. (A DRE representative said any other complaints are confidential.)
True, the contracts the Gilroy couple signed were in English, she said – but so are all real estate contracts.
“We use all the forms from the California Association of Realtors for anything that is binding, and none of those are in Spanish,” said Avila’s husband and attorney, Rafael Cebrero, who manages Rancho Grande. “There’s nothing we can do about that.”
Other Gilroy agents contacted by the Dispatch said they don’t provide Spanish-language contracts either, instead relying on their own bilingual agents or a client’s bilingual relatives to translate.
“I explain everything in Spanish to my clients,” Avila added. “There’s no way they can say they didn’t understand.”
California civil code requires those who negotiate agreements in Spanish to provide a written Spanish-language translation of that contract, unless the buyer provides their own translator. But the law doesn’t apply to standard mortgages or mortgage loans, said June Barlow, vice president of CAR, and few agents supply Spanish-language translations. If customers can’t understand English, they should hire their own neutral, third-party translator to assist with contracts, she said.
“Agents can’t have their own employees do it,” she said. “They’re not a disinterested party.”
When real-estate agents translate their own contracts, they’re left open to claims of fraud – claims difficult to dispute beyond the he-said, she-said between agents and clients. Yet the practice isn’t rare, and when Spanish-speaking families sign contracts they can’t understand, foul play is all too easy, said Mike Sanchez, a real estate agent working to help Romero and Garcia re-sell their house. Though he speaks Spanish, Sanchez said he always encourages clients to bring a third-party translator to prevent costly misunderstandings.
Sanchez learned of the couple’s plight through his father, teacher Ed Sanchez, who had helped Garcia pass the U.S. citizenship exam through classes at the Gilroy Family Resource Center.
“It may not be illegal,” said Mike Sanchez, “but it’s certainly unethical.”
Farmworker, repairman earned
less than $4,000 a month
Freshly painted a birds-egg blue, the duplex on Ninth Street looked ideal to Garcia and Romero, even with a nearly $820,000 price tag.
Neither knew that a mere four months earlier, the home had sold for $684,750 through Rancho Grande Real Estate, according to Multiple Listing Service records. No major improvements had been done, nor were there multiple offers on the home, said Mike Sanchez: In fact, the home wasn’t listed on MLS when it sold to the couple in December 2005. Comparable duplexes of the same age on similarly sized lots, including one on the same Ninth Street block, sold for between $579,000 and $760,000 that fall, Sanchez added.
Garcia and Romero asked if they could offer less than the $820,000 Avila presented, but Avila said no, Garcia claims. Still, the couple was prepared to pay the higher price: The issue was the monthly payments.
The two didn’t have much to spare. Garcia earned $350 per week picking chile, Romero $512 repairing air conditioners. Avila asked the couple for $3,200 payments per month – more than 90 percent of their monthly incomes, said Ed Sanchez.
Romero and Garcia planned to offset the loss by renting out half of the duplex for $1,500 a month, cutting their monthly payment down to $1,700 – slightly less than half their pay.
Meanwhile, Garcia claims Avila coached the couple to lie when the mortgage company called, providing a fake San Jose address and occupation. At home, Garcia displays a red-orange index card, which reads ‘Alarcon Interior Designer,’ the business name she said she was supposed to give. Avila denied the allegation, speaking through Cebrero.
“They have beautiful credit and there was no need to do that,” Cebrero said. “It’s not a practice that we condone. That statement is absolutely incorrect.”
In November 2005, the couple closed the escrow at Financial Title Company on Wren Avenue, signing a pile of English-language forms. Mike Sanchez said the title company is a neutral third party, and is unlikely to be involved in any wrongdoing; the company’s Gilroy office referred the Dispatch to a representative who declined comment, saying Financial Title isn’t involved in setting monthly payments.
“Maria [Avila] didn’t explain anything in detail,” said Garcia. “She just said, this is for this, that is for that.”
Acting as both buyer’s and seller’s agent, Avila made $28,700 on the sale – 3.5 percent of the total $820,000 sale price, said Cebrero.
Romero felt uneasy, he said, but their dream home finally seemed within reach. It wasn’t until the couple’s first bills arrived that their fears materialized.
Foreclosure now threatens home
The two loans the couple signed with Financial Title totaled nearly $5,300 a month – a staggering amount for the Gilroy couple. Garcia telephoned Avila to ask why the payments were so much higher than the $3,200 she claims they’d agreed to. According to Garcia, Avila asked to borrow the paperwork, then agreed that the payment was excessive, and said she’d look into it. Avila never returned their calls, Garcia said, and they haven’t spoken since; the agent said the family never contacted her at all.
“Now, after two years, they bring this up – I don’t believe them,” Avila said. “If there was something they needed, they could contact me.”
To pay the loans, Romero and Garcia cut back their expenses and began borrowing heavily, racking up thousands in credit-card bills. Romero logged more and more hours on the job, working 12 hours a day, seven days a week to pull in more money. Meanwhile, their renters moved out abruptly, leaving their rooms so trashed that others wouldn’t rent them, Garcia said. By October 2006, they’d stopped paying their loans entirely. To make matters worse, Romero lost his job.
Garcia sought help from her teacher Ed Sanchez; he, in turn, notified his son, real estate agent Mike Sanchez, who is helping the couple resell the home to minimize their debt.
“I’ll do whatever it takes to get them through this landmine,” said Mike Sanchez, leafing through the couple’s contracts. “We looked at refinancing, but it was obvious they were in way over their heads. There’s no practical way to make up the difference.”
On March 6, 2007, the couple defaulted on their first loan. According to county records, Garcia and Romero owed $19,480.50 on March 2, and the debt will increase until it’s paid.
“We just want an end to the stress,” said Romero, sighing. “But also, we want to know what action we can take. How we can seek justice from this company that robbed us.”
