What's Hot
What's Going On


Search thousands of events in our database.


Search hundreds of restaurants in our database.


Search hundreds of clubs in our database.


OW on Twitter
OW on Facebook
Print Email


No end to Chinese drywall woes

Property owners have no choice but wait until lawsuits wend their way through court system

Photo: SOURCE: Florida Department of Health, License: N/A

SOURCE: Florida Department of Health

The Chinese drywall problem

Florida has had the largest number of reports of defective Chinese drywall in the United States. The map shows the number of complaints received by the Florida Department of Health from each county, through Jan. 18. A recent investigation by ProPublica indicates that the number of complaints to various agencies may seriously underrepresent the scope of the problem.

Photo: , License: N/A

She says lenders ought to give homeowners involved in drywall-related lawsuits temporary forbearance on loans until those suits settle. The mortgages could be renegotiated, and then hopefully, when affected homeowners receive some compensation for their problems, they can go about repairing their homes and repaying their mortgages. Campbell says she's especially interested in working with Fannie Mae, since it's a provider of so many mortgages - and currently has properties up for sale that may contain Chinese drywall.

When asked what its policy is on reselling properties affected by tainted drywall, a representative for Fannie Mae says "all issues that are known to Fannie Mae are disclosed in accordance with applicable state and?local laws."

"Fannie Mae does not inspect REO [real estate owned] properties for problem drywall, and prospective buyers must sign a standard contract that includes a provision acknowledging that homes are sold `as is,'" says Janis Smith, a media and external relations representative for Fannie Mae. "That being said, the prospective buyer may have his/her own inspection done, and if problem drywall is found, they may cancel the contract without penalty."

But that's not good enough, Campbell says: "These homes should not be sold, period."

Campbell and her husband are meeting with politicians and banks to propose that a restructuring plan be put in place for mortgages on homes proven to contain the defective product. This is not an entirely altruistic effort - Chinese Drywall Recovery is a for-profit entity, and if banks and politicians choose to work with it as a consultant, the company would recoup a small fee from the banks as compensation. Ultimately, Campbell says, her plan would save the banks money because they would eventually be able to collect on the mortgage once a drywall case is resolved.

"These lawsuits are going to resolve eventually," she says. "But a lot of people can't wait. They can't live in the house, it's destroying all their stuff, the fumes get into the electronics and appliances. People are getting sick, even though the CDC says they aren't . so they walk away."

So far, Campbell says, Chinese Drywall Recovery has met with Sen. Bill Nelson (D-Florida) and politicians in Mississippi and asked them to put pressure on lenders to cooperate. (A representative from Nelson's office was not able to provide more information by press time.)

In the meantime, affected property owners, like the Henrys, must wait. According to Pete Albanis, an attorney for Morgan & Morgan who's working with plaintiffs in the federal suit, "There are constantly ongoing settlement discussions with the manufacturers and suppliers of the board," so it's tough to say how or when things will settle. One of the companies that sold defective board, Knauf, has actually moved forward on settling with some of the plaintiffs. So far, it has agreed to remediate 300 homes as part of a pilot program; if it goes well, Albanis says, there's hope the program could be expanded to cover all of the homes that contained Knauf board. As each individual home is remediated, he says, homeowners drop out of the case. For now, though, the case is still open and going through the discovery process. "We've exchanged tens of thousand, if not hundreds of thousands, of documents. We've taken depositions, and the next status hearing before the judge is Feb. 23."

We welcome user discussion on our site, under the following guidelines:

To comment you must first create a profile and sign-in with a verified DISQUS account or social network ID. Sign up here.

Comments in violation of the rules will be denied, and repeat violators will be banned. Please help police the community by flagging offensive comments for our moderators to review. By posting a comment, you agree to our full terms and conditions. Click here to read terms and conditions.
comments powered by Disqus