(June 10, 2008) -- The foreclosure trustee on a Sacramento property on which Washington Mutual Bank (WaMu) was the lender and Cong. Laura Richardson (D., Carson-LB) was the owner has filed a notice to rescind a May 2008 foreclosure auction sale of the property.

The notice of rescission has been recorded in the Sacramento County Recorder's office and is a matter of public record.

Asked for comment/information on the action, WaMu spokesperson Sara Gaugl told LBReport.com:

"I'm unable to discuss the specifics of Ms. Richardson's loan situation because she has not provided us with authorization to publicly discuss her loan. We are, however, committed to treating all of our customers with the same level of consideration and fairness.

"More broadly, if any loan has gone to foreclosure sale in error, we will work to take appropriate measures to rectify the situation.

"As you would expect, the conditions in which a lender would seek to rescind a foreclosure sale are driven by the specific facts of each case."

News of the development was first reported today (June 10) by Daily Breeze.com reporter Gene Maddaus (and appeared in the co-owned Press-Telegram) and indicates the new buyer of the property intends to keep the property and plans a lawsuit against Cong. Richardson and WaMu regarding the latest action. LBReport.com independently confirmed information regarding WaMu's action and other information reported below.

Cong. Richardson has previously told LBReport.com (and other media outlets) that she believes rescinding the sale is justified, citing communication between her and her lender to cure a default on a Sacramento property...which nevertheless proceeded to a foreclosure auction at which time it was purchased by a new buyer,

As reported by LBReport.com, on May 23 Cong. Richardson provided us [and other media outlets] with a copy of an April 17, 2008 letter she received regarding the Sacramento property. It indicates it's a debt collection letter [typed signature line indicates the lender], refers to loan reinstatement figures in an enclosed document not provided to us, invites remittal of the reinstatement amount to the lender's address.

"We have placed a sixty day hold on all foreclosure sale or actions; the hold will expire June 4, 2008," the letter states.

Cong. Richardson also provided us with a May 22, 2008 email to her from a third party [name blacked out, but she identified it in her conversation as her lender] which includes an unsigned consent form it says is needed to release an attached letter to a third party purchaser "to facilitate the rescission of foreclosure sale."

In a May 23 telephone conversation with LBReport.com, Congresswoman Richardson described what took place as follows:

Cong. Richardson: The [May 22 document] asks me to provide consent to provide this document to the third party mortgage company who was involved with this on May 7 [reads the consent form]...Prior to April 14, I had had several conversations with this lender, but on April 14 we came to a final agreement of what my payment program would be for this property. On April 17, they sent me this letter [refers to reinstatement amount, sixty day hold and June 4 expiration date]...

So what this demonstrates to you and to everyone else we've been talking to is that at the time of May 7, I had an agreement in hand, I had reinstatement figures and I had began to pay on those reinstatement figures and was operating in a reinstatement loan modification.

Now how their departments communicated that a reinstatement was on file, I can't speak to, but what I can say is my lender agrees that I had an agreement. I know I had an agreement, and we now taking the appropriate process to have this prior, pre preliminary sale to be rescinded.

As first reported May 20, 2008 by the Sacramento-based Capitol Weekly, the Sacramento property's lender filed a notice of default on that property in December 2007 which went to an auction sale and was purchased by a new buyer in May 2008.

As previously reported by LBReport.com and multiple outlets, notices of defaults were recorded by other lenders in connection with properties owned by Richardson in Long Beach and San Pedro. Defaults on the LB property were filed but rescinded. A default on the San Pedro property had escalated to a notice of auction sale but the sale hasn't taken place.

In connection with her May 23 conversation with us, Cong. Richardson provided documents indicating that the LB and SP home loans have been modified and are current and reinstated.

Cong. Richardson said at the time: "I do have an active, viable loan that I am responsible for to make payments for that [San Pedro] property [and] for all three pieces of property."

Property taxes on the Sac'to property were reportedly in arrears at the time of its auction sale but are current on the two L.A. County properties.