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Republican Presidential Candidate Takes Out Series of Mortgages on $2M Great Falls Home

How Rick Santorum has financed his home.

A search of land records for the $2 million Great Falls home of Republican presidential candidate and former Pennsylvania Senator Richard Santorum turns up a series of mortgages that at times equaled and exceeded the sales price of the property.

The industry guideline is usually mortgages should not exceed 75 percent of the appraised value of a property, according to mortgage experts. The assessed value of the Great Falls home, which is set by Fairfax County, has fallen since Santorum bought it in 2007.

Property values have fallen throughout the county—even in the wealthiest communities of McLean and Great Falls—because of the recession.

It's a fascinating story to follow the real estate transactions of this presidential aspirant who is also a neighbor. All the transactions are found in the Fairfax County land records. We're going to walk you through Santorum's life as a Fairfax County homeowner.

In September 1995, as a newly elected senator from Pennsylvania, Santorum and his wife bought a house in Herndon for $292,000, according to the Fairfax County deed.

In November 1998, the couple took out a mortgage of $244,000 on the home, according to the mortgage filed in the county courthouse.

In November 2001, the Santorums sold the home for $429,900 to Randy and Coleen Gallagher. The Santorums moved to Leesburg in Loudoun County.

Usually mortgages are paid off when homes are sold. Not in this case. The Santorums paid off the mortgage in October 2003, according to county documents.

In 2006, Santorum ran for a third term in the U.S. Senate and lost, due in part to the controversy over whether he actually lived in Pennsylvania, and after he enrolled five of his children in an online cyber school paid for by the Penn Hills (PA) School District, despite the fact that all the children lived in Virginia.

The family returned to Fairfax County in August 2007. They bought a house with five acres in Great Falls with a high-ranking official of a major development and mortgage company.

Santorum formed the Creamcup Trust with James Sack, the secretary and general counsel of NVR, a major single-family developer and mortgage finance company in northern Virginia and 15 states. Creamcup Trust bought a house  and five acres of land on Creamcup Lane in Great Falls for $2 milllion in August 2007, according to the deed.

Over the years Santorum and wife Karen have secured a series of mortgages on the 35-year-old, four-bedroom home.

The Creamcup Trust took out a mortgage for $1.5 million from American Home Bank in Lancaster, PA. On the same day, the Santorums took out a mortgage for $200,000 in their own names from the same bank, according to county records. The two mortgages represent 85 percent of the sales price.

The family repaid the $200,000 loan a year later, according to the records.

Now things get a little more complicated. In June 2009, the trust transferred ownership to the Santorums, so the home is now listed in the names of Richard and Karen Santorum.

In February 2010, the Santorums took out a $999,950 mortgage on the home that continued to carry the $1.5 million mortgage. That's nearly $2.5 million in mortgages on a home that sold for $2 million.

A month later, March 2010, the $1.5 million mortgage was repaid.

In July 2010, the Santorums secured a $1 million mortgage from Ing Bank in Minnesota. Now, the house with an assessed value of  $1.4 million, carried nearly $2 million in mortgages.

In October 2010, the Santorums repaid the $999,950 mortgage, according to land records.

About the $1 million note: It's a 30-year mortgage with a 4-percent interest rate. The property's assessed value has fallen to $1.2 million.

The two-story brick house, north of the village of Great Falls, was built in 1977. It has four bedrooms, four baths, a swimming pool and sits back from the road in a serene setting.

Patch contacted Matt Benyon, deputy communications director for the Rick Santorum for President campaign, for information pertaining to this story but got no response.

A McLean Neighbor January 18, 2012 at 05:28 PM
First let me say I am not a big Santorum supporter. That said, how is this news? You talk about him taking out a loan in Feb. 2010 and then about a month later, March 2010, the 1.5 million previous loan was paid. But wait, he carried notes worth 2.5 mil on his house he bought for 2.0 mil for 30 days and somehow that is wrong! Did you ever think it was probably paid when he took out the loan in Feb. 2010 but it took the county about a month to record it? REALLY! This is quite a partisian article and it seems that almost every political article I read on Patch is always against Republicans! Every transaction detailed above sounds absolutely normal. No where does it mention was he in default. He has repaid his loans and there was a time not long ago that the banks would lend up to 107% of the value of your home! Why is this Patch's business? So he bought through a trust? Many celebs/politicans do. As an attorney, I would advise my client to do just that as well if it made sense in the situation. Patch you need to do a better job of being bi-partisan.
Peter January 18, 2012 at 08:24 PM
It's news because the whole story reeks to high heaven. You tell me if a regular person off the street (even someone who had the money) would have been allowed to do any of this from 2007 to the present. Santorum can have 2 mortgages out totaling $2.5 million on a house that's valued around $2 million? That's 125% of the home's value. The rest of us would never have been able to get away with taking a series of mortgages out like this. It's shady, just like all of Santorum's dealings. And it's news. You don't get to decide what is and is not news for the rest of us.
FF January 18, 2012 at 08:24 PM
There's nothing in this article except statements of fact. How are facts partisan?
Gloria Giovannini Simon January 18, 2012 at 08:44 PM
Just a question, how many houses out there are upside down on their loans. People that bought their homes a couple of years ago, now the assessed prices are half of the loan price. If you don't believe me, go to the counties on their web sites and check. As well, the assessed value is not the sale value. You will find in good timesand even bad times, that the sale value is much higher than the assessed value. The assessed value is just for tax purposes. I do not know about taking loan after loan out, but it does seem that they are being paid back. So what is the deal. When the ecomony comes back, he will probably sell it for over 3 million.
Chris Anderson January 18, 2012 at 08:45 PM
I challenge the Patch to get the dates of the actual transaction records from the lenders and then report back. The transaction dates and the filing dates with the county are seldom the same. Filing the documents with the county is a task typically paid for by the borrower as part of closing costs, but performed by others (the lender's clerks). The borrower has no control over when or if the documents are filed with the county in a timely fashion. I had a lender that didn't file documents on a refinance for 18 months. In short, the article seems to accuse Santorum of mortgage shenanigans, but provides no evidence to support the accusations. In fact, it factually paints Santorum as someone who pays his debts in a most timely fashion and doesn't carry excess debt on his property.
Chris Anderson January 18, 2012 at 08:51 PM
McLean Neighbor's point is made by Peter's comments. To suggest that the Patch wasn't purposely seeking to taint Santorum is simply disingenuous. It worked in Peter's case.
Chris Anderson January 18, 2012 at 09:04 PM
The facts are seldom partisan, but the partisan intent of the authors determines which facts are presented, which ambiguities aren't clarified, which exculpatory "facts" are omitted, what value judgements surround the facts, what adjectives are used, and, via inclusion, what importance to attach to the facts. Any reader who chooses to see just the facts will see no story here. I'm sure the "investigative reporters" (roll eyes) that did this half job will report the "story" if one emerges.
Bob January 18, 2012 at 10:11 PM
Hey Bobbi Bowman - Patch Editor - How much is YOUR house worth?
Hondo Howard January 18, 2012 at 10:19 PM
Bobbi Bowman isn't running for president. Bobbi Bowman isn't making promises about how she would fix the country's economy. And, probably, Bobbi Bowman doesn't have million dollar loans on her house for more than it's worth, which the rest of us can't get. These are all legitimate facts to be presented, it's not partisan. It's journalism. Right wingers who only watch Fox are not familiar with that. The rest of us are.
Chris Anderson January 18, 2012 at 10:30 PM
Of course Hondo. You have no partisan political axe to grind. As for this story, it is having it's desired effect. It is stimulating partisan bickering and some critical commentary, which in the online "journalism" trade, is the path to advertising revenue. Hit count is king. More power to the authors...this article has nothing to do with reporting, however...more like baiting.
Hondo Howard January 18, 2012 at 10:37 PM
If I hadn't thrown in that stupid last sentence, my comment would have appeared way more impartial. Good catch Chris. The rest stands.
Bobbi Bowman January 18, 2012 at 11:07 PM
Reason for this story: We simply wanted to share these facts with the neighbors because they are interesting. Mr. Santorum is NOT accused of any wrongdoing. The story is simply a recitation of how he has financed his house over the years.
PJ Buckley January 19, 2012 at 12:17 AM
Just another hachet job by a hack publication. Nothing new here.
Bob January 19, 2012 at 01:59 AM
Thee facts aren't interesting Bobbi. The guy has done nothing illegal. PJ is right. This is a hack publication.
Chris Anderson January 19, 2012 at 02:01 PM
Really Bobbi? How good of you to point out that the man is not accused of any wrong doing. Your article goes to great pains to imply impropriety every step of the way, and you know it. Laughable.
paul waldron January 19, 2012 at 09:22 PM
MY MONEY GOES TO SANTORUM
Bruce January 19, 2012 at 10:16 PM
Regardless of Santorum's political affiliation, this list of "screwy" (to say the least) real estate money shuffles does not appear to validate the type of financial acumen that one would expect to see in a presidential candidate. It would have been VERY difficult for an "average" citizen to pull off the "over 100% of appraised value" loans that Santorum took out. What AREN'T we being told about how some of these transactions got approved, etc...
RMFS January 19, 2012 at 11:05 PM
This is yet another example of sensationalist journalism. Really, if you are going to write an article you need to get your facts straight. When a mortgage is paid off the lender has 120 days to release the lien from the land records. Put some effort into researching the important facts.
Bob January 20, 2012 at 03:13 AM
Research and fact? These words don't exist in the Patch vocabulary - neither does code of ethics. Patch and Bobbi Bowman continually tout they want to report on "our neighbors." This nonsensical reporting seems more "Mrs. Kravitz" than "good neighbor.
Chris Anderson January 20, 2012 at 11:32 AM
To the contrary Bruce, the transactions aren't in the least bit "screwy". They actually show NOTHING either way because the facts aren't fully disclosed. By the way, which "fact" quoted an appraised value for lending purposes? I only saw county tax appraisals mentioned in the article. Do you know the difference? I didn't see ANY mention of any loan exceeding appraised value. All I saw mentioned were apparent county recording lapses. A payoff/loan that settles in February and is recorded with the county in March is hardly newsworthy. You should ask yourself as diligently about the facts that Bobbi HASN'T researched or shared if you want to form an opinion about Mr. Santorum's finance. There isn't a single element of this story that is unusual or "fascinating" (Bobbi's word). The fact that you see it that way says more about you than the story says about Santorum.
Rick January 24, 2012 at 02:19 AM
I think I'll write out the case A McLean Neighbor makes: In September 1995, they bought a house for $292,000 In November 1998, they refinanced their loan with a new loan for $244,000 In November 2001, the Santorums sold the home for $429,900 (Could it have taken 2 years for the paperwork to be filed? That seems long, but why would a bank let you sell a house when you owe them money?) They bought a house for $2 milllion in August 2007, using a first trust of $1.5 million and a second trust of $200,000. Two loans totaling 85% was pretty routine in 1998 - it's more cost effective than PMI when you take taxes into account. I don't know what they do today, but I would suspect that for a good risk, the loans will still be made. They paid off the second trust a year later. In February 2010, the Santorums refinanced their loan, replacing the $1.5 million loan with a $1 million loan. In July 2010, the Santorums refinanced their $1 million loan with a different $1 million loan. It took 3 months for the paperwork to be filed closing out the old loan. I agree with A McLean Neighbor - there seem to be some refinances in the face of rising and later falling appraisals, that's all. There's plenty of story on him; this isn't it.
paul waldron January 24, 2012 at 05:30 PM
Demonize the CHRISTIAN Blubber over the MARXIST a la Chris Mathews?
R. Hillam February 15, 2012 at 03:19 AM
It's important to know how a candidate spends, saves, and uses his money. I imagine everything is legal; the bigger question is if Santorum received a sweetheart deal that most Americans could not get. If Santorum would release his taxes, it would be an easier thing to mitigate.
Ed Morrow February 18, 2012 at 12:11 PM
Hey Bobbi, please do similar research on Congressman Gerry Connolly and let us know what you find.
Chris Anderson February 18, 2012 at 12:44 PM
Now that his taxes are released, are your concerns mitigated?
Chris Anderson February 18, 2012 at 08:50 PM
Ben - I flagged your comment as "inappropriate". Hey patch editors...REALLY???
Anna Gibson February 19, 2012 at 12:58 PM
Great article with good reporting. The vitrol of the comments is even more interesting. Says tons about the state of our discourse. The article walks through a series of facts and neither condemns nor endorses. It just states. Good journalism if you ask me. I don't know if there is anything wrong with the mortgages but I know that there is a lot of access there that would not be available to a regular person. When you run for public office - espeically that of president - you have to expect examination and to have to explain some things. This may be easily explained. But the explanation must be made.
patchfan February 20, 2012 at 04:02 PM
If this is a story, why not balance it out with this story that went virtually untold. http://www.washingtontimes.com/news/2008/nov/04/fbi-asked-questions-on-rezko-land-deal/?page=all
Bob March 11, 2012 at 01:08 AM
The fact is this isn't a criminal act, but Santorum got sweet heart deals from people he passed legislation for. He's no better than Chris Dodd that crook, got the same kind of preferential banking treatment. Rick corrupt actions with his charitable trust, used money for himself http://www.rightspeak.net/2012/02/is-rick-santorums-favorite-charity.html Imus, why Santorum scares me, told Imus wife to back off on Pharm give him $ http://www.youtube.com/watch?v=vY_k0TMobEQ&feature=youtu.be Santorum is a pathological liar. Rick is also a thief, he stole from his own charity. Rick Santorum most corrupt politician 2005 & 2006 http://www.crewsmostcorrupt.org/mostcorrupt/entry/most-corrupt-2005 http://www.crewsmostcorrupt.org/mostcorrupt/entry/most-corrupt-2006 http://networkedblogs.com/uI90Y Rick Santorum Lied about deal with Specter http://politicalticker.blogs.cnn.com/2012/02/24/specter-disputes-santorum-account-of-support/?utm_source=twitterfeed&utm_medium=twitter&utm_campaign=Feed%3A+rss%2Fcnn_politicalticker+%28Blog%3A+Political+Ticker%29 BUSTED! Santo caught bold face lie http://www.youtube.com/watch?v=kLaEJ5h1A2k http://www.youtube.com/watch?v=kLaEJ5h1A2k http://politicalticker.blogs.cnn.com/2012/02/24/specter-disputes-santorum-account-of-support/?utm_source=twitterfeed&utm_medium=twitter&utm_campaign=Feed%3A+rss%2Fcnn_politicalticker+%28Blog%3A+Political+Ticker%29 Another lie http://www.youtube.com/watch?v=BUTyC-7SNGQ

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