UPDATE 9-13-12:Prices paid at auction by the banks on Jones six properties are at the end of the story
New Canaan’s queen of McMansion sales is being forced by local bankers at Ridgefield Bank to vacate her home of sixteen years. The Connecticut District Court judge denied Ruth Jones appeal for a stay yesterday so the auction of her six homes went forward. According to Ruth’s daughter, Stephanie, no outside parties entered viable bids so banks like Ridgefield Bank, Connecticut Community Bank & Country Bank won the homes using their credit bids. This means Jones lost five rental investment homes that will now sit as REO assets on the books of the local banks. Her beautiful 7,500 sq ft McMansion, that she built in the mid 90’s and raised her three children, is now property of Ridgefield Bank who held two secured loans in total of $3.5 million against the 75 Beacon Hill home.
A court order filed by Judge Shiff today says Jones six-year lease to her brother Alton who is sick with cancer is now null and void. Jones had set up the lease after she filed chapter 11 bankruptcy in 2009 so her brother could live in an in-law suite at her primary residence. As result of the court order, Ridgefield Bank got the home free and clear of all liens and leases at yesterday’s auction. The secured creditors, who had not been paid in three years since Jones filed for bankruptcy, get possession of the homes fast. The bankruptcy docket says the closing date for her five investment properties is set for September 28th. And Ridgefield, who started dolling out million dollar loans to Jones in the early 2000’s, is moving fast to kick her out. Court records show next week, September 18th, they’ll hold a hearing for a vacate date.
I previously reported on Jones battle with her bankster creditors last month. New Canaan resident David C. House who invested in one of Jones rental investments was awarded a credit bid in April after he sued Jones for false representation and fraud. Court records show the case settled and the judge wouldn’t allow Jones to discharge the settlement House won in bankruptcy. House picked up Jones beach front vacation rental near tony Watch Hill, RI yesterday for about half of what Ruth paid in 2006.
Richard Coan, the New Haven-based bankruptcy trustee in charge of the bankruptcy assets, can now use the $300k in the DIP account to pay himself and unwind the bankruptcy by dolling out the rest of the DIP cash to the secured creditors (the banks). Coan said the prices Ridgefield bank and others paid will be loaded in public court filings (PACER) by tomorrow. Stephanie Jones wrote me today saying she thinks the banks paid less than what her mother Ruth had offered in her modification plans–plans none of the banks accepted over the course of the three year bankruptcy battle.
Ridgefield Bank gets to play landlord now and spend the banks money to manage maintenance on the large Beacon Hill home till they sell it. So far Ridgefield Bank did not recover anywhere near the $3.5 million they lent Jones but are about to succeed in making Jones and her family homeless.
New Canaan Homes sold at Auction are:
139 – 141 River Street, New Canaan, Connecticut to Country Bank; $393,000
75 Beacon Hill, New Canaan, Connecticut to Ridgefield Mortgage; $2,250,000
279 Old Stamford Road, New Canaan, Connecticut to Residential Credit; $1,564,150
277 Old Stamford Road, New Canaan, Connecticut to Connecticut Community Bank; $1,750,000
42-44 Urban Street, New Canaan, Connecticut to Bank of America; $380,000
994 Charlestown Beach Road, Wakefield, Rhode Island to David C. House; $910,000