From the  Daily Breeze (Torrance, California)
By Gene Maddaus

Rep. Laura Richardson lost her Sacramento home in a foreclosure auction two weeks ago and left behind nearly $9,000 in unpaid property taxes. Richardson, D-Long Beach, appears to have made only a few payments on the house, which she bought in January 2007 for $535,000. After buying the home, Richardson hardly had time to live in it. Three months later, Rep. Juanita Millender-McDonald died and Richardson - then a freshman member of the state Assembly - launched a campaign to replace her in Congress.  Richardson won the election, pouring in $77,500 in personal loans to her own campaign. Around the same time, she stopped making payments on the Sacramento house. The bank issued a default notice in December, and the home was sold at a public auction on May 7 for $388,000. Richardson declined to be interviewed Wednesday about the foreclosure, which was first revealed in Capitol Weekly, a Sacramento-based publication. But in a statement, Richardson denied that the home was in foreclosure and said it had not been seized by the bank.

"I have worked with my lender to complete a loan modification and have renegotiated the terms of the agreement - with no special provisions," Richardson said in the statement. "I fully intend to fulfill all financial obligations on the property."

That would come as a surprise to James York, the Sacramento real estate broker who bought Richardson's house at auction. York specializes in buying and selling foreclosed homes, and said he eventually intends to resell Richardson's home, which overlooks a park in an upscale neighborhood.

York produced a trustee's deed confirming that his company, Red Rock Mortgage Inc., owns the house.

York said the house was relatively clean when he found it, at least compared to other foreclosed homes, though the garage was "full of trash to the ceiling." Workers have been cleaning it out and tending to the yard, which had been left unmowed for months.

When he bought the house at 3622 W. Curtis Drive, York assumed responsibility for Richardson's unpaid property tax bill of $8,950.79.

"Tell Laura I'd be happy to have her pay my property tax," York said.

The real loser in the deal was Washington Mutual Bank, which issued Richardson a $535,000 loan with no money down in January 2007. By the time the default notice was issued, Richardson was underwater on the loan. She owed about $575,000, including $18,000 in missed payments.

Washington Mutual ended up writing off nearly $200,000 of that debt to get rid of the property. "They took a beating," York said.

The previous owner of the home, Sharon Helmar, said the neighbors were "appalled" that Richardson was not maintaining the lawn. Another neighbor said that until recently the grass was about a foot high.

"It's kind of heartbreaking to see something you've worked on for 30 years be left and not taken care of," Helmar said. "You would have thought someone like that would have been a little more responsible."

The home is only a few minutes' drive from the Capitol. It is about 1,600 square feet, and has three bedrooms and 1 1/2 baths. It sits on a corner facing Curtis Park.

"It's your typical 1920s house," she said. "Hardwood floors, wallpaper. It's not huge, but it served us for a lot of years."

The neighborhood is known as affluent and politically liberal. A mayoral candidate lives nearby, and a former state senator lives three doors down.

"It is a very stable neighborhood," said Charlene Singley, the Realtor who sold the home to Richardson. "It has been affected by the downturn, however, because it is in the older, more established area of Sacramento, and it is close to the downtown urban core. It is one of the few neighborhoods that has not been hit as hard."

Singley was surprised to hear that the home had gone into foreclosure. Helmar said Richardson had delayed the purchase so long that that she started charging a daily penalty. Ultimately, Helmar paid a large portion of Richardson's closing costs.

"She was not a polite lady," Helmar said. "She had our Realtor in tears."

Singley declined to comment on the specifics of the transaction, calling it a private matter.

Though Richardson did not pay her property taxes or the balance of her loan, she has begun repaying the loans that she issued to her own political campaign. To date, she has returned $18,000 of the $77,500 in personal loans, according to federal campaign finance records.

Richardson, a former Long Beach city councilwoman, still owns a home in Long Beach.

One of Richardson's first votes upon arriving in Congress last fall was on the Mortgage Forgiveness Debt Relief Act of 2007. The bill helped homeowners by preventing the federal government from charging income tax on debt forgiven in a foreclosure, such as the $200,000 forgiven in Richardson's foreclosure.

Joining 385 of her colleagues, Richardson voted aye.