My Dad Took Out $520,000 In Mortgages In My Name Without Me Knowing

Summary

Podcast Summary: "My Dad Took Out $520,000 In Mortgages In My Name Without Me Knowing"

Podcast Information:

• Title: The Ramsey Show Highlights
• Host/Author: Ramsey Network
• Description: A quick, daily dose of advice on life and money in under ten minutes. Features experts like Dave Ramsey, Ken Coleman, Rachel Cruze, Dr. John Delony, George Kamel, and Jade Warshaw. Delivered seven days a week.
• Episode: My Dad Took Out $520,000 In Mortgages In My Name Without Me Knowing
• Release Date: June 12, 2025

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1. Introduction to the Caller’s Predicament

At 00:11, a distressed caller reaches out to "The Ramsey Show Highlights" with a troubling financial situation. She shares that her father passed away in July of the previous year. Fifteen years prior, while backpacking, she and her father established a power of attorney to safeguard her finances during her travels, especially after experiencing theft in New Zealand.

Caller’s Statement:

"What I didn't know was that over the last 15 years, he had taken out about $520,000 worth of high-interest mortgages in my name." (00:11)

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2. Unveiling the Financial Fraud

The advisors quickly identify the severity of the situation. At 00:37, Advisor 2 responds:

"That feels like fraud to me." (00:37)

The caller elaborates that her father utilized her power of attorney to secure approximately $520,000 in high-interest mortgages without her knowledge. These mortgages are tied to multiple properties, all of which are currently underwater—meaning the outstanding mortgage amounts exceed the properties' valuations.

Caller’s Details:

• Total Mortgages: $520,000
• Property Example: Property valued at $75,000 with an $180,000 mortgage (06:24)
• Interest Rates: Up to 30% (04:07)

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3. Legal and Financial Implications

The conversation delves into the legality of the situation. The caller mentions that initially, a lawyer advised her that the power of attorney made her father legally authorized to act on her behalf. However, she now grapples with the repercussions of his actions.

Advisor 1’s Concern:

"How upside down are you?" (04:19)

The advisors express alarm over the exorbitant interest rates and the possibility that the mortgages border on illegality due to the disproportionate loan amounts compared to property values.

Caller’s Financial Strain:

• Additional Debt: $90,000 student loan taken out recently
• Current Income: Approximately $40,000 a year part-time; anticipated increase to $60,000-$100,000 with her new license (06:18)

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4. Step-by-Step Guidance from Advisors

The advisors offer a structured approach to addressing the crisis:

1. Report the Fraud:

   • Advisor 1: Emphasizes the importance of reporting the fraudulent loans to credit agencies to dispute the validity of the debts. (01:05)

2. Document and Dispute:

   • Request all documentation related to the loans, including loan applications, signature pages, and the notarized power of attorney. (05:07)

3. Legal Action:

   • Consider filing a police report to formally document the identity theft and unauthorized use of the power of attorney. (05:15)

4. Financial Assessment:

   • Evaluate the total debt and explore options like selling the underwater properties, despite their current depreciated values. (04:24)

5. Debt Management Plan:

   • Develop a comprehensive plan to manage and repay the debts, incorporating her student loans and upcoming income from her new career. (06:38)

Advisor 2’s Empathy and Advice:

"I hope you can work with your attorney to work this out." (08:27)

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5. Personal Financial Struggles and Future Outlook

Beyond the immediate crisis, the caller shares her personal financial challenges. She recently completed flight school, incurring a $90,000 student loan, and is currently unemployed but optimistic about securing a well-paying job soon.

Caller’s Financial Snapshot:

• Student Loan: $90,000
• Current Employment: Unemployed, completed training last week
• Household Status: Renting, plans to buy a home were derailed by the debt crisis

The advisors encourage her to remain steadfast, drawing parallels to similar situations they've encountered and overcome.

Advisor 1’s Encouragement:

"If it makes you feel any better, I paid off 460,000 of debt. And it was terrible. But at least it was debt that I racked up." (07:53)

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6. Conclusion and Final Advice

The episode concludes with the advisors reiterating the importance of legal counsel and strategic debt management. They acknowledge the emotional and financial toll on the caller and emphasize that while the path ahead is challenging, a structured approach can lead to resolution and financial recovery.

Final Takeaways:

• Legal Action: Essential for disputing fraudulent loans
• Debt Management: Critical to assess and prioritize debts
• Emotional Support: Recognizing the emotional strain and offering empathy

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Notable Quotes:

• Advisor 2 (00:37): "That feels like fraud to me."
• Advisor 1 (04:19): "How upside down are you?"
• Caller (06:24): "For instance, one of them is valued at 75k and there's $180,000 mortgage."
• Advisor 1 (07:53): "If it makes you feel any better, I paid off 460,000 of debt. And it was terrible. But at least it was debt that I racked up."
• Advisor 2 (08:27): "I hope you can work with your attorney to work this out."

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Key Insights:

• Power of Attorney Risks: Granting power of attorney can expose individuals to significant financial risks if not meticulously managed and legally documented.
• High-Interest Debt Dangers: Loans with exorbitant interest rates (e.g., 30%) can quickly escalate debt burdens, especially when tied to undervalued assets.
• Legal Recourse: Prompt legal action, including reporting fraud and disputing unauthorized debts, is crucial in mitigating financial damage.
• Debt Management Strategies: Comprehensive debt assessment and strategic repayment plans are essential for financial recovery, even in the face of overwhelming debt.

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This episode underscores the critical importance of understanding and carefully managing legal instruments like power of attorney, as well as the necessity of vigilance against financial exploitation. The advisors provide a compassionate and structured approach to navigating such complex financial crises, offering hope and actionable steps for recovery.

Transcript

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[Caller]

Yeah, I'm calling to see. My father passed away last July, and when I was backpacking about 15 years ago, we created a power of attorney to kind of protect me when I was traveling, as I had one experience where all my stuff got stolen. What I didn't know was that over the last 15 years, he had taken out about $520,000 worth of high interest mortgages in your name. In my name.

[Advisor 1]

Wow.

[Advisor 2]

That feels like fraud to me.

[Caller]

Yeah, so, yeah, I'm just kind of. At first it was one of those things where I just didn't know if I should go to the courts for that because I was defensive in protecting my father. But since now it's been almost a year and it's not really been cleaned up at all. And I'm kind of not sure what to do financially.

[Advisor 1]

Oh, gosh. So have you, you have reported it or not yet?

[Caller]

I haven't.

[Advisor 1]

Okay. No, I think that's the first step, right. Is you can see this thing on your credit report. So kind of saying this, this wasn't me, this was my dad. And yeah, the fact he's. He's no longer with us. What are those next steps?

[Caller]

Yeah, sorry. When I did speak to one lawyer at the beginning and he said because I had a power of attorney, that my dad was legally able to do this on my behalf. That's kind of all the legal advice I've been given.

[Advisor 1]

Okay.

[Caller]

Yeah, so. And I did sign it, but in 2011, I believe. So, yeah. I'm kind of just not sure where to go now with that.

[Advisor 2]

Well, the good news is this is secured debt. So there's properties attached to this that you could sell.

[Caller]

They all have mortgages on them? Yes, but unfortunately all the evaluations are inflated, so the mortgages are actually worth more than the property. So.

[Advisor 2]

So you're underwater on each of these properties?

[Caller]

Yes.

[Advisor 1]

Oh, my gosh.

[Advisor 2]

How is that possible? How did the mortgage companies let this happen?

[Caller]

Private lenders.

[Advisor 2]

So was this some, like, sketchy back end deals that he used this money for something nefarious? I'm confused.

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[Advisor 2]

So was this some, like, sketchy back end deals that he used this money for something nefarious? I'm confused.

[Caller]

Yeah, I'm not really too sure. It looks like there might have been a big master plan, but unfortunately he passed before he could fix it. So I do believe there was a plan, but I'm not sure exactly what that was. But he had mortgages on properties to rebuild a home to I believe sell his current home to clear all the debt, but he never made it there.

[Advisor 2]

Goodness gracious.

[Advisor 1]

What happened to the. Did he have any assets when he passed?

[Caller]

He had his personal house. Unfortunately, that was. It did flood and then I wasn't able because I have siblings, so legally I wasn't able to sell his personal house to pay off my personal debt, which wasn't my debt, but it was his debt, but legally it wasn't in his name.

[Advisor 1]

Wow. So these mortgage companies are coming to you saying pay up or sell.

[Caller]

Yeah, these are all private lenders that actually invested their rrsp. So it doesn't actually show up on my credit at the moment, but they basically took collateral. Wow.

[Advisor 2]

Have you pulled your credit report to see if any other debts were taken out in your name or accounts?

[Caller]

I have. And nothing shows up.

[Advisor 2]

Just these private lender mortgages, which I assume have terrible terms.

[Advisor 1]

Gotta be.

[Caller]

Yeah, 30% interest.

[Advisor 1]

Oh, holy moly. Holy smokes.

[Advisor 2]

Okay.

[Advisor 1]

Oh, gosh. Wow. How upside down. That's the real question. How upside down are you?

[Advisor 2]

Hundreds of thousands. Give us an example of one of the properties. What's it worth? And what is.

[Caller]

For instance, one of them is valued at 75k and there's $180,000 mortgage.

[Advisor 1]

My word.

[Advisor 2]

Yeah. That feels illegal to even issue a mortgage at that point. Yeah, I would. I mean, if I was in your shoes. Obviously you need to work with an attorney. We're just two people on a. On a show. But here's what I at least would do if I was in your shoes. I would let the mortgage lenders know in writing that number one, these loans were made without your consent, and it was based on an abuse of the power of attorney authority and that you want to dispute the validity of the debt. And then you can ask for. Give me copies of the loan application, the signature pages, the notarized power of attorney that was used. I would make them give you everything they have.

[Caller]

Yeah. I have all that. My signature was. It was signed on my behalf. And like I said before, they. They just use my power of attorney and said it was all legal.

[Advisor 2]

And you report. Have you reported this? Like, done a police report?

[Caller]

I haven't done a police report yet, no.

[Advisor 1]

Well, there was the power of attorney, and I'm. I'm not a lawyer here, so I'm just asking was the power of attorney that was granted in case you were unable to make financial decisions, right? Not in every case.

[Caller]

My stuff got stolen while I was in New Zealand.

[Advisor 1]

Exactly.

[Caller]

Kind of hard. Yeah, exactly. So I guess there was some clauses in there that maybe were put down that I didn't really fully understand.

[Advisor 1]

Like what?

[Caller]

Yeah, well, just making. There was actually the loan clause and other things like that. So I kind of.

[Advisor 1]

Here's the thing. And. And I. I hate this for you. And I don't know, I'm just going based off of what you're saying. Unfortunately, it does sound like there was language in this that puts you on the hook for it. And because of that, because it's a legal document, you might have trouble getting out of this, and I hate that for you. Let's pretend, for the sake of the last few minutes of this call, let's pretend you can't get out of it. Let's pretend lawfully you're on the hook for it. Tell us about your financial situation and let's see if we can walk you through a way out of this.

[Caller]

Yeah. Okay. So I actually just finished. I just went through flight school. So actually personally, in the last two years, took out a $90,000 student loan, which I just finished my training all last week. That loan I took out just. I wasn't making. I make maybe 40k a year part time because I was in school. So. Yeah, I really.

[Advisor 1]

What do you make now that you got your license?

[Caller]

Yes. Oh, I haven't. I just graduated last week, so I haven't actually got a job yet.

[Advisor 1]

Okay. When do you see. When do you see that happening? And when that does happen, what will you be earning?

[Caller]

Um, I would say hopefully in the next few months and maybe up to 60 to 100k depending.

[Advisor 1]

So we've got this. There's a possibility to make a hundred thousand dollars. So you've got the 90,000 of student loans. Have you totaled up all the debt? If you were to sell the properties, what would be the upside down amount for all these properties combined? From your dad?

[Caller]

Yeah, I would probably still owe about 250 to 300.

[Advisor 1]

Oh, my gosh. Okay. And your student loans is the only debt you have? No car loans, no credit cards, nothing like that?

[Caller]

No, I have no credit card debt. Or that's the cars. It's all been paid off.

[Advisor 1]

Okay. And it's just you, no kids, significant other. Okay. So. Man, I hate this for you. I. I mean, I just hate it. But at the same time, if you end up on the hook for this, we want to make sure that you have a plan to get out of it. And it might. Do you own your own house?

[Caller]

No, I actually just rent at the moment. Me and my husband were actually hoping to buy last year, but we got kind of stuck in this.

[Advisor 1]

Okay. And where's your mom?

[Caller]

So I live about 5,000 km on the opposite side of the country, and they're not together. My parents.

[Advisor 1]

Got it. Okay. So there's. It's not like you can call her up and say, hey, look. Look what. Look what your husband did. Okay. Oh, boy. Unfortunately, I hate to tell you, Amanda, you. You might have to walk the baby steps on this one. And. Okay, it's a clear path. It's worked for me. If it makes you feel any better, I paid off 460, 000 of debt. And it was terrible. But at least it was debt that I racked up. So for you, you're gonna have a bitter taste in your mouth if you have to do this. But the good news is you can do it.

[Advisor 2]

Oh, I hope you can work with your attorney to work this out. Even if they foreclose on it and they waive your deficiency, that at least might get you out. With all of this damage and years of cleaning the mess up, that's a best case scenario. Worst case, it's going to be years of hard work. So sorry you're going through this.

[Advisor 1]

Wow. Wow.

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