200 Unlicensed Loans Made

State authorities say records obtained from the Cook County Recorder of Deeds indicate that the companies have issued more than 200 mortgages since 2002 for amounts ranging from $25,000 to nearly $200,000.

The mortgage companies provided financing for two home repair companies — Father & Sons Contractors, Inc. and Father & Sons Remodelers, Inc. Court documents say DiBrito is also president of both contracting companies. Neither contracting company is named as a defendant in the lawsuit.

Illinois state authorities got involved after they received 12 complaints about the mortgage firms and the quality of the home repair work performed by the contractors. The plaintiffs say the companies either did not do the work as agreed or made shoddy home repairs.

State authorities say that when customers called to complain, they were told the home repair company and mortgage company were separate and that the mortgage had to be paid in spite of any dissatisfaction with the work. DiBrito did not tell consumers that she was president of both the home repair and the mortgage companies, according to the lawsuit.

As could be gleaned from the 77-page complaint, all three mortgage companies have the same telephone number and address.

“It’s all a misunderstanding. It will all be straightened out,” declared a man who came to the telephone and identified himself as Tony. He declined to give his last name or to provide any more details. DiBrito could not be reached for comment.

Court documents say an agent for Father & Sons, Ronald Kafka, solicited home repair business from consumers, convincing them to allow the Father & Sons to do the work. The company would then refer consumers to one of the mortgage companies to finance the project. Once the consumer signed the home repair and mortgage contracts, the mortgage companies would demand payment, regardless of whether the work had started or whether there were complaints about the quality of the work, according to the lawsuit.

In one instance, a non-English speaking Hispanic married couple said they took out a $99,500 loan in 2004 to pay to have a second story added to their house. The couple said in the lawsuit that the contractors did not complete the addition as agreed, leaving the Illinois house with a partially removed roof, destroyed electrical service to the garage and uninstalled air conditioning.

The couple said that when they asked that the work be completed, the contractors called the husband “a stupid Mexican” and demanded more money.

The husband told the court that he was so stressed by the encounter with the contractors that he suffered a mild stroke and had to be hospitalized.

When foreclosure proceedings were initiated, the couple countersued for fraud. Court documents say that as of last week’s court filing, the work on the couple’s house remained incomplete.

DiBrito’s companies have filed more than 70 foreclosure actions against homeowners, according to the lawsuit.

Madigan has asked the court to forbid the defendants from offering residential mortgage loans without a license. She has asked the court to order the contractors to pay restitution to the homeowners. She has also asked for civil penalties of $50,000 and additional penalties of more $50,000 for each instance of fraud.

The contractors are facing their own legal woes. The Illinois Attorney General Office filed lawsuits last May against Kafka, DiBrito and both contractors for multiple violations of the Consumer Fraud and Deceptive Business Practices Act. Two of those lawsuits are still pending.

Lisa D. Burden is a legal analyst for MortgageDaily.com and holds a law degree from the University of Maryland. She is currently a freelance journalist who previously wrote for Institutional Investor publications and the Baltimore Daily Record.

e-mail Lisa at: burdenlisa@yahoo.com