Alleged victims of 'slumlord millionaire' get reprieve as sheriff's sale postponed
TODAY was supposed to be D-Day for Kevin Donaldson.
His Port Richmond house was scheduled for sheriff's sale. He feared he'd lose his dream of running a barbershop out of the home he had hoped to own.
Donaldson and dozens of others got a reprieve yesterday after two banks agreed to postpone sheriff's sales of 160 houses. All the houses are owned by real-estate mogul Robert N. Coyle Sr., who became known on Kensington's streets as a "slumlord millionaire."
The Daily News last week detailed allegations that Coyle promised some of the city's poorest that they could rent to own. The hopeful homeowners spent thousands of dollars of their own money to rebuild Coyle's decrepit houses - some without walls, plumbing, kitchens or heat.
What they didn't know was that Coyle had defaulted on more than $15 million in mortgage loans on their homes and that they could be out on the street after the banks foreclosed.
Coyle walked away from his mortgage payments and padlocked his Port Richmond real-estate office, on Allegheny Avenue near Memphis, after he found himself at the center of a massive fraud investigation by local and federal authorities.
The investigation began in spring 2008 with allegations that Coyle forged hundreds - possibly thousands - of city housing-inspection licenses that allowed him to rent the homes, many of which were uninhabitable.
Coyle also owes the city hundreds of thousands of dollars in property and business taxes and water fees.
Those living in Coyle's homes frequently found that their water had been shut off. They also faced leaking roofs, seeping sewage and rotted floors.
Their situation worsened earlier this year when the banks slapped sheriff's-sale notices on the homeowners' front doors.
For months, Coyle's alleged victims have lived in limbo with on-again, off-again sheriff's sales hanging over their heads.
Yesterday, those in Coyle's homes said they felt hopeful for the first time.
"I feel like my dreams are coming true," Donaldson said. "I think justice will prevail."
Republic First Bank, which loaned Coyle $6.6 million on Donaldson's home and 117 others, has agreed to postpone its sheriff's sale until March 2.
Bank representatives broke their silence yesterday and publicly announced that they're trying to work out agreements with Donaldson and others who want to stay in the homes.
"Republic First Bank has been meeting with attorneys for Mr. Coyle and many of the residents in an effort to see if there is a way for the bank to safeguard its rights as a creditor of Mr. Coyle while allowing those residents who signed lease/purchase agreements, and have honored their commitments, to remain in their homes," Republic First said in a statement.
Hopefully, the postponement "gives the residents some breathing room to sort out the chaos that Mr. Coyle has created," the bank said.
Stefanie F. Seldin, managing attorney for Philadelphia Volunteers for the Indigent Program (VIP), is fighting on behalf of Coyle's tenants to stop the sheriff's sale.
"It's too early to tell if it's a victory, but we're cautiously hopeful that things can be worked out," Seldin said yesterday.
Coyle, in a court filing, blames Republic First for some of his financial woes, claiming that the bank pressured him to take on a loan that he couldn't afford. Coyle alleged that he only agreed to take on the debt because Republic First promised to provide his title company with $20,000 worth of business each month. But the bank never delivered on that promise, Coyle alleged.
Yesterday, Coyle's civil attorney, Alan L. Frank, said he was unaware of any rent-to-own agreements that Coyle made with tenants. But Coyle is in favor of the banks working out any deal with the residents, Frank said.
Jeanette Marcano, 43, said she's anxious to strike a deal. And unlike her dealings with Coyle, Marcano said she won't be hoodwinked.
"When it's time to talk to the bank, I'm going to let them know that it's not going to be only on their terms because I'm not going to sign no 30-year mortgage," Marcano said. "I want to know exactly what I'm getting into before I sign anything."
Marcano argues that she has already spent about $10,000 to fix up the Kensington home, which had no plumbing or interior walls. She says Coyle promised that she would own the home after paying rent for a year.
In addition to Republic First, Coyle defaulted on loans from four other banks, including East River Bank. A Common Pleas judge recently delayed the sheriff's sales on 42 of the 66 houses that Coyle had used as collateral to obtain a $3.5 million loan from East River in May 2007. The remaining 24 houses are slated for sheriff's sale today because none of those residents is fighting to stay.
Inez Ramos, who lives in Frankford on Buckius Street in one of the 42 houses that got a reprieve, felt more at ease yesterday.
"Maybe there's a light at the end of the tunnel," she said. "Maybe there is someone out there who has a heart . . . I don't want my grandkids to think that everyone who has money and a business is a dream snatcher."
