Mortgage holder posts top bid in foreclosure auction for Norwich illegal events venue, short-term rental house
Jul. 15—NORWICH — Neighbors outnumbered bidders Saturday at the mortgage foreclosure auction at 138 Mediterranean Lane that neighbors hope will return the house to a residential home in their quiet street instead of a disruptive, unpermitted large-events venue and short-term rental.
Mortgage holder PMIT REI 2021-C LLC posted the high bid to cover its debt on the property, $513,921, well above the only other bid of $450,000, posted by a man who declined to identify himself. The noon auction was held on the street in front of the property, as owner Huey Min Lee of Renaissance Quest LLC had rented the house for the day.
About 15 residents of Mediterranean and nearby Wightman Avenue watched the proceedings. Wightman Avenue resident Lorna Gallagher brought a bottle of Champagne and a few glasses to share it with neighbors to celebrate what they hoped was the beginning of the end to loud events, vehicles parked along the narrow streets, excessive traffic and festival tents on the property.
The presence of renters in the house Saturday also prevented potential bidders from inspecting the property prior to the auction. New London attorney Stephen E. Reck, the committee of sale for the auction, said two signs posted in the weeks prior to the auction were removed from the property.
Reck said he will communicate the auction results to New London Superior Court Judge Josephine S. Graph, who had ordered the foreclosure auction sale. Reck told the lower bidder that his bid will be communicated to the plaintiff mortgage holder. Reck told neighbors that typically when the mortgage holder obtains a property through foreclosure, the company puts the property up for sale.
"We're hopeful that it goes back to a residential property," Mediterranean Lane resident Stuart Peil said. "We'll be very glad when Ms. Lee doesn't own the property anymore."
On Friday, Lee sent an email to Reck with a copy of a "Notice of Intent to Sue for Mortgage Fraud" she had sent on July 14 to the state Supreme Court, New London Superior Court, Attorney General William Tong, Secretary of the State Stephanie Thomas and the state Department of Administrative Services and to Reck.
"You have committed foreclosure fraud which constitutes federal, criminal and civil offense," the notice stated.
In a text to The Day following the auction, Lee wrote that she predicted no one would show up at the auction.
"This is just another practice of foreclosure scams, which have been the root causes for the decay of our community, of America," Lee wrote to The Day.
Neighbors said usually, every weekend, there are several cars parked at that address for rentals. The last big event was held last summer. Peil said even though the smaller rentals are not disruptive, they still are illegal uses of a residential house.
Gallagher said during one large event, her husband was unable to drive home from church, because the narrow street was clogged with parked cars. Large box trucks also have blocked the street to deliver supplies to events at the site.
The Mediterranean Lane house is one of three Norwich houses Lee has rented for large events. Different mortgage companies have filed mortgage foreclosure actions against all three homes. Willmington Bank was granted a strict foreclosure on the historic Lathrop Manor at 380 Washington St. and turned over property ownership to IRP REO II LLC in February.
A mortgage foreclosure auction sale has been scheduled for Sept. 16 against the third large events venue at 270 Broadway, which remains pending in New London Superior Court. In that case, Noah Bank claims an unpaid debt of $404,294 on the property valued at $720,000.
Lee fought the foreclosure of 380 Washington St. in court filings but failed to file appearances in the action against 138 Mediterranean Lane or the large mansion house at 270 Broadway, which is owned under the name Mount Crescent House LLC.
She continues to challenge actions by city planning and zoning regulators and building officials for filing numerous notices of violation for her events venue operations and short-term rentals.
Wightman Avenue resident Gallagher said she hopes if the mortgage company does put the Mediterranean Lane house up for sale, the firm makes it clear that it is a single-family residential house and a residential neighborhood, not an approved short-term rental or event venue site.
