A unit owner in Paraiso Bayviews accuses a mortgage company owned by a semi-celebrity Miami broker and the Miami-based Devstar Group of trying to force her to pay $100,000 in illegal late fees for taking behind on his payments, according to a recently filed lawsuit.
Paraiso Ocean LLC, a company owned by Veronica Aguilar Garrido, is suing International Mortgage Capital Fund I in Miami-Dade Circuit Court for breach of contract, fraud and deceptive practices. It’s an attempt to stop the foreclosure sale of Unit 307 in the 44-story tower at 501 Northeast 31st Street. Garrido’s entity purchased the studio for $560,900 in 2018, records show.
Last month, a Miami-Dade judge granted a $519,292 foreclosure judgment in favor of International Mortgage Capital Fund I. An auction is scheduled for April 18.
Company records show the mortgage company is owned by Devstar directors George Helmstetter and Anthony Burns, as well as Michael Internoscia, a real estate agent and mortgage broker who was featured in a 2014 episode of “Million Dollar Listing Miami” from Bravo TV. M&M Private Lending Group, another company owned by Internoscia, is also named as a defendant in the Garrido entity lawsuit. Garrido claims she fell behind on her mortgage payments due to financial hardship as a result of the Covid-19 pandemic, the complaint states.
Internoscia told The Real Deal that Garrido’s entity lawsuit is completely inaccurate. “When people don’t pay off a mortgage, they hire lawyers to come up with every possible excuse,” Internoscia said. “The lockdown was dropped long before Covid even started. We tried to solve this case six or seven different times.
Internoscia referred further questions to Brian Kopelowitz, attorney for International Mortgage Capital Fund I. Kopelowitz did not respond to a phone message and email seeking comment.
According to the March 2020 foreclosure lawsuit, M&M Private Lending Group provided Garrido’s Paraiso Ocean with a $360,685 loan in 2018. The proceeds were used to finance the purchase of the 1,069 square foot studio in the 386-unit building in Miami’s Edgewater neighborhood. .
M&M transferred the loan to International Mortgage Capital Fund I, and Garrido’s Paraiso Ocean defaulted on the mortgage when it stopped making payments in August 2019, the complaint says.
Garrido’s Paraiso Ocean lawsuit, filed in January, alleges Garrido fell behind on his payments as a result of the pandemic. “However, the plaintiff has taken every precaution and measure available to attempt to mitigate this issue, but the International Mortgage Capital Fund, I would not budge,” the lawsuit states. “When the plaintiff was ready to make its payments and repay its arrears, International Mortgage Capital Fund, I requested an additional penalty of $100,000.00 in order to reinstate the note.”
The $100,000 demand violates state law, Paraiso Ocean de Garrido claims.
Garrido, who has lived in his Paraiso Bayviews studio since its purchase, disputes Internoscia’s version of events. She said she fell behind on her payments in 2019 after she was forced out of the unit when a plumbing pipe broke and caused extensive damage to her condo.
“I had to pay rent, mortgage and expenses to renovate my apartment,” she said. “Even with everything going on, I was able to update all my payments [in 2020].”
Garrido, who said she has receipts for all her loan repayments, including those paid in cash, alleges the lenders wanted her to sign a document reinstating the mortgage. It contained a clause that she would have to return the unit if she made another late payment, she said.
“I refused to sign,” Garrido said. “They filed a lawsuit just before everything was shut down because of the pandemic.”
Garrido, who is from Ecuador, said she found other irregularities from when she decided to buy the studio. Although she made a down payment of $250,000, she was unable to qualify for a conventional loan, Garrido said. “The idea was that I would get this hard-money loan from M&M and then refinance it later,” she said. “But they didn’t give me the mortgage documents until closing day, and they rushed me to sign everything.”
It wasn’t until the lenders started sending her default notices that she began to carefully read the terms of the agreement, which included a penalty of $400 a day for each day of late payment, and an increase in her interest rate to 18% once she fell behind, Garrido said.
“They took advantage of me from the start,” Garrido said. “They set it up so they could do this to people legally.”
Internoscia and Devstar have previously been in legal trouble over the co-development of Marina Palms Yacht Club and Residences, a luxury waterfront condominium in North Miami Beach. In 2018, real estate agent Yamile Espinosa and his brokerage firm Miami Grand Realty sued Internoscia, Marina Palms Realty, Marina Palms Residences North and Marina Palms Residences South for allegedly withholding payment of a $356 condo sales commission. $400. All three companies are owned by Devstar Group and its development partner, The Plaza Group.
In 2020, Espinosa voluntarily dismissed the lawsuit after reaching a confidential settlement with the defendants, according to court records.