Lena Jones has been picking up the pieces of her subprime life for more than five years.

It's a descent that began in 2000 when the Inglewood resident wanted to fix up her two-bedroom, two-bath townhouse she'd bought for $87,000 two years before.

Jones, who's now 58, was paying $900 a month on a $149,000 first mortgage after fees, insurance and other points but didn't like the condition of her house and decided to take out a line of credit to make the improvements.

After first being rejected for a $53,000 loan by Beneficial Finance, then a subsidiary of Household International Inc., she got an unexpected call telling her that her loan had been approved.

It was nothing less than hard money.

The loan amounted to $52,904 including $3,903 in points and fees at an interest rate of 11.5 percent, which later grew to 12.5 percent at least that's what she thought at first.

But when she received a check for about $60,000 she realized that not only had she been slapped with a full second mortgage, but the final loan amount was closer to $73,000, far more than she wanted. That left her with a $1,150 monthly payment on top of her first mortgage, a lot for a community resource advisor who nets $2,300 a month working for a non-profit.

"I applied for a line of credit. It said nothing about a home equity loan. Beneficial didn't tell me I was getting a second mortgage. I was just flat out lied to," she maintains, rummaging through the original documents. "That's almost $1,200 before I even stepped out the house, ate or paid utilities."

Beneficial refused to comment on Jones' allegations, but the Inglewood borrower's story is not uncommon among homeowners who have financed household improvements with subprime lines of credit or second mortgages. In fact, Jones testified at hearings on predatory lending that then Councilman Mark Ridley-Thomas held in 2002.

Keith Corbett, executive vice president Center for Responsible Lending, said that to a lot of subprime lending outfits, a single woman is the "golden goose."

"But a single black woman in a low-income neighborhood is the Holy Grail with diamonds in it," he said. "In (Jones') case, they were after her equity. What you have is someone paying down debt and not building wealth."

Refinancing repeatedly

Jones was able to complete some improvements on her home, though she's not finished with everything she wants to do.

"It still needs work," she said, pointing to cracks and crevices in the walls and ceilings of her living room. "But you should've seen it back then."

Without money to seek legal recourse, Jones sought the help of the Acorn Housing Corp., a mortgage and credit counseling arm of the Association of Community Organizations for Reform Now. She ended up doing the only thing she could: refinance repeatedly.

After the $73,000-plus Beneficial loan came due, she refinanced her payments to get her rate down, working with at least five institutions that originated, sold and serviced her loans over the next six years.

These groups were a virtual "Who's Who"of leading subprime lenders, such as Ameriquest, Countrywide and ResMae Mortgage, all of whom declined comment on her case and subprime lending in general.

"When you're stuck, you're stuck," Jones said. "People ask me why I bounced around so much. It's hard to find better rates when you're already highly leveraged. Plus I started off with an Ameriquest loan and then out of the blue get a statement from Countrywide telling me they've bought my loan, adjusted the interest rate and need to inspect my property."

Acorn officials say the transfer process between lender organizations is shoddy at best and that institutions can lose payments from borrowers or fail to report complete payment histories to the new proprietors of the loan.

Jones wonders if race were a factor, even though blatant redlining the practice of denying loans to home buyers simply based on their race has been virtually eradicated.

Douglas Duncan, an economist for the Mortgage Brokers Association of America, concedes that there is an atmosphere in lower income areas that fosters what he calls "aggressive" lending. "What you get in the end is a borrower leveraged to the hilt," he said.

Jones, who through Acorn is doing her latest consolidation with Allied Home Mortgage Capital Corp. at a rate just north of 7 percent, now owes about $200,000 in total mortgage debt, a figure that with increasingly stagnant home prices leaves her with little equity. The home was recently appraised at about $275,000, which could drop if home prices fall.

Jones has kept up with payments on her loans even though it stings her pocketbook every month. She doesn't see herself as a martyr but as a "teacher" with first-hand experience. She said she'll continue to do the best she can in paying down what she owes while keeping better records.

"When it's all said and done, I think I'll be fine," she said. "But there are so many people who won't be fine, who will lose everything. I've been trying to make things right for almost 10 years now, and I'm here to help people, to keep them from making that first mistake on that first loan."

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