Aug. 24--Jerry and Inez Baldwin had been counting on getting a small sum of money from the settlement of a class-action lawsuit involving toxic Chinese-made drywall.
The proceeds would amount to nowhere near the $180,000 that the Williamsburg couple lost after fleeing their contaminated home in June 2013, but it was the only money related to the defective wallboard that was set to come their way.
Now, though, mortgage giant Fannie Mae has staked a claim to their money -- and that of nine other Virginia families whose walls seeped hydrogen sulfide into the air, sickening them and ruining air conditioners, wiring and other metal objects.
Jerry Baldwin said he and his wife, who moved into their home in 2006, were blindsided.
"We weren't looking to get rich off of that, but we were hoping it would help to compensate us for some of the physical loss and some of the emotional stress that we've gone through," Baldwin said.
No other lenders have submitted claims for money in the four Chinese drywall settlements in Virginia, said attorney Matthew Garretson, founder and CEO of The Garretson Resolution Group, which is charged with dividing the money among homeowners. About 250 homeowners have filed eligible claims for property losses.
A handful of insurance companies representing builders, suppliers and installers agreed to collectively pay $17.4 million. Homeowners won't receive equal shares, but the amount works out to about $42,000 each. Attorneys have said some will get as little as $9,600.
Philadelphia attorney Arnold Levin, who is among several lawyers representing Virginia families in drywall lawsuits, said the settlement money is more significant to homeowners than it is to Fannie Mae.
The company has been "difficult to deal with, and they've taken a stance that other lenders haven't taken," Levin said.
Garretson said his firm will work out agreements between Fannie Mae and the families on how to split the money.
To qualify for part of the settlement money, a party has to either own or have owned a house built with the drywall, Garretson said via an emailed statement. The Baldwins say that after years of faithfully paying their mortgage, they handed their home over to Fannie Mae through a deed in lieu of foreclosure in 2013.
Fannie Mae is a government-controlled company that props up the nation's secondary mortgage market. It buys mortgages in bundles called securities so that lenders don't have as much risk to face.
A spokeswoman said the company would not comment on why it believes it is entitled to the settlement money.
The Baldwins and hundreds of other Virginia families that were affected by the defective drywall have yet to receive a cent in compensation for the tens of millions of dollars they collectively lost over the past eight years.
The government did not offer disaster assistance to the families, and insurance companies were not required to repair their homes. Most of them were uninhabitable and very difficult or impossible to sell.
Except for a few families who were able to afford the steep expense of hiring a contractor to repair their homes or who were able to do the work themselves, many drywall families lost their homes through foreclosure or bankruptcy. Others had to persuade their banks to accept short sales.
Jerry Baldwin, 64, said he planned to retire when he was 66, but he doubts he'll be able to.
"The right thing to do, the honorable thing to do," he said, "would be for us to get 100 percent of the funds and for Fannie Mae to withdraw their claims to any funds."
Sarah Kleiner Varble, 757-446-2318, firstname.lastname@example.org
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