Home / Articles / News / News / Besieged owner claims big foreclosure ‘political’
Print this Article
Thursday, April 28, 2011 03:20 pm

Besieged owner claims big foreclosure ‘political’

JSP vows legal fight against 153 foreclosures

art8607

The house at 812 S. Pasfield St. in Springfield is one of 153 properties at stake in a large foreclosure proceeding against JSP Investments of Springfield.
PHOTO BY PATRICK YEAGLE

A Springfield business owner says he’ll fight in court the foreclosure of 153 properties worth more than $6.7 million total. Meanwhile, he alleges the bank is putting profit before Springfield’s best interests.

Jeff Polen of Taylorville, owner of JSP Investments and a handful of similarly-named companies in Springfield, faces foreclosure on 153 mortgages held by State Bank of Lincoln on houses and other properties he owns in Springfield, Riverton, Illiopolis, Auburn and Pawnee. Polen rents many of those houses to tenants under a rent-to-own plan, so tenants could lose equity they’ve built toward a home purchase if the properties are foreclosed.

“I’m getting steamrolled by big business,” Polen says. “I know it happens, but I never thought it could happen to me. I mean, you see it in the movies.”

Foreclosure filings allege that Polen and his companies stopped making payments on the mortgages and have allowed the properties to fall into disrepair.

Polen claims to have previously worked out a deal with State Bank, in which he would have sold off the mortgaged houses and repaid the bank, but he says the bank canceled six such sales and filed for foreclosure anyway.

“They didn’t want to do that because it would have showed precedent of working with me,” Polen says. “They want their money now. They don’t want to work with me.”

“I don’t believe that to be true,” counters Phillip Montalvo, a Lincoln-based attorney for State Bank, adding that the bank’s efforts to work out a plan with Polen failed.

“The bank has tried to work with Mr. Polen now for months,” Montalvo says. “It hasn’t worked out. Up until even two weeks ago, we were still making an effort to get the matter resolved with Mr. Polen. We made a proposal, but he never responded.”

Montalvo declined to discuss the nature of the bank’s proposal.

But Polen says State Bank declined to renew his mortgages because of an agreement the bank has with the Federal Deposit Insurance Corporation. In July 2009, State Bank purchased assets – including Polen’s mortgages – previously held by the failed John Warner Bank in Clinton. As part of that acquisition, State Bank has a “loss share agreement” with FDIC, which provides for federal reimbursements to the bank if those acquired assets fail.

The loss share agreement stipulates that if a bank forecloses on mortgages it acquires, it can’t collect reimbursement until those mortgaged properties are sold, and then only if the bank takes a loss on the sales. That means State Bank would have to sell the foreclosed properties for less than it paid for the associated mortgages in 2009. Polen – who claims to have never missed a payment in 23 years with John Warner Bank – did not return calls requesting further comment.

Montalvo says that the loss share agreement has “absolutely nothing to do with this litigation. Mr. Polen has said that it does. It does not.

“I want to be crystal clear on that,” Montalvo continues. “It has nothing to do with it. We are obligated to do what we have to do. The gentleman owes money; he hasn’t made the payments.”

He says the bank will try to work with current JSP renters.

Polen also claims that two banks in Taylorville – Palmer Bank and First National Bank in Taylorville – are willing to take over his mortgages, but he alleges State Bank has not returned calls from those banks. A call seeking comment from Palmer Bank was not returned, and a person who answered the phone at First National Bank in Taylorville refused to comment or let an Illinois Times reporter speak with anyone else at the bank.

Regardless, Polen promises to fight the foreclosures in court, which could mean a protracted legal battle in Sangamon County courts and JSP tenants whose housing futures are uncertain.

Polen indicated to Illinois Times that he did not explicitly tell all of his tenants that the houses they rented were mortgaged, but he says he has sent a newsletter to his tenants explaining the situation. In the meantime, he wants tenants to continue paying rent as usual.

“We’ve got to all stick together in this,” he says. “If they don’t pay me, I won't have the money to fight this battle.”

One JSP tenant, Jennifer Milligan of 812 S. Pasfield St., says she isn’t worried.
“I’ve talked to [JSP] about it, and they’ve let me know they’ll take care of me,” she says. “If I have to move, they said they’ll help me find another place. I’m continuing to pay my rent to them, and I’m not worried. They’ve been good to me.”

Contact Patrick Yeagle at pyeagle@illinoistimes.com.

Polen's rental properties are spread throughout Springfield. An interactive version of this map is available here.

Log in to use your Facebook account with
IllinoisTimes

Login With Facebook Account



Recent Activity on IllinoisTimes

Calendar

  • Thu
    30
  • Fri
    31
  • Sat
    1
  • Sun
    2
  • Mon
    3
  • Tue
    4
  • Wed
    5