Countywide : Bank Offers to Negotiate on Solar Foreclosures

An Oakland-based bank that won the right to foreclose on homes in Orange and Los Angeles counties despite the claims of residents that they were tricked into buying solar-heating equipment has offered to negotiate with homeowners in arrears.

Central Bank, in letters mailed March 24 to more than 400 customers, pledged not to foreclose until customers have “an opportunity” to bring their loans to current status.

The homeowners said in an Orange County Superior Court lawsuit that they did not realize that they were risking their homes to secure loans to pay for solar-heating equipment. Represented by the Public Interest Homeowners’ Assn. of Los Angeles, they sued dozens of solar firms and banks last summer, complaining of deceptive sales practices and solar equipment that did not work.

But a judge refused last month to halt threatened foreclosures, ruling that Central Bank was not responsible for the allegedly deceptive practices of the solar-unit contractors and salespeople.

Joe Morgan, a spokesman for the residents, said about 20 of the 400 who had stopped making payments to Central Bank were faced with the probability of losing their homes.

The others had continued making the regular payments on second mortgages into a special trust fund and will be able to transfer the funds to Central Bank to bring their loans up to date, said Morgan, who added that his group is considering filing a new lawsuit in federal court.