May 22, 2008 -- Can you imagine losing your home over a $68 dental bill? That's what happened to one Utah woman.
Sonya Capri Ramos says her Salt Lake City home was sold out from under her in 1996 to pay a collections agency seeking payment for dental work performed on one of Ramos's daughters. And despite the fact that she had made three years of payments on a $51,000 mortgage, the title changed hands for just $1,550 at a sheriff's auction.
But the story doesn't end there: Ramos, 41, said she didn't find out that her home no longer belonged to her until two years after the sale. To date, she hasn't moved out.
Instead, she said she continues to make mortgage payments on the home and is fighting what has become a decade-long legal battle to reclaim ownership.
Most recently, a state appeals court ruled against Ramos. She and her lawyer, she said, are preparing to appeal to the state's supreme court.
"It's a big mess," Ramos said.
It Began With Cavities
Ramos said she bought her three-bedroom home with her then-husband Roger Bangerter in 1993. The couple used a $51,000 loan from Salt Lake City under the city's first-time home buyer program.
Two years later, she took her second-oldest daughter, Bailee Bangerter, to the dentist for cavity treatments on the girl's baby teeth.
Ramos said she paid for part of the treatment, but not all of it -- a $68 bill remained.
Ramos said she had "all intentions" to pay the bill, but didn't. "I wish I would have borrowed money to pay it at the time," she said wistfully.
A collections agency, North American Recovery, eventually sued her for payment of the bill, which by 1996 had escalated to more than $950, a result, Ramos said, of legal fees and other costs associated with collecting payment on the original bill.
But Ramos said she was never notified of the lawsuit and therefore didn't contest it.
A Legal Loss
With no legal defense, a judge ruled in favor of North American Recovery and ordered the local sheriff's department to sell off Ramos's property to satisfy the debt.
According to a 10-page published decision by the Utah Court of Appeals, the judge ordered the sheriff "to collect the judgment, with costs, interest and fees, and to sell enough of defendant's non-exempt real property to satisfy" the amount due.
Keith Meade, a Utah lawyer who focuses on real estate matters, said that this type of judgment typically allows some leeway for just a portion of the defendant's property to be sold off to satisfy the debt owed, which in this case was far smaller than the value of the home. But because the real estate at stake was Ramos's home, which by law is considered "indivisible," the title to the entire property was sold at auction.
Ramos's home was sold in 1996 to Jarmaccc Properties, a Utah company, for $1,550, according to the court documents.
Under the terms of such a sale, a property's buyer -- in this case, Jarmaccc -- buys the title to the home and the right to take over the mortgage payments. But Jarmaccc never did that because Ramos, who said she was never given notice of the sale, said she continued making the monthly mortgage payments herself.
"I continued to pay my mortgage," she said. "I didn't know the house was sold."
She was effectively paying off the note on a home she no longer owned. And for various reasons, she has continued to make payments in the 12 years since, allowing Jarmaccc the chance to eventually keep the home for just the $1,550 it paid at the sheriff's auction.
Ramos estimated that she has paid more than $50,000 toward the principal loan plus interest, the bulk of which came after that 1996 sheriff's sale.
A Shocking Realization
Ramos said she didn't even learn about the sale until 1998, when Salt Lake City denied her application for a loan to do renovations on her home.
"They told me, 'You don't even own the house,'" she said. "I was dumbfounded that somebody else had the title."
But according to the court documents, a deputy sheriff signed a 1996 certificate stating that there was "due and legal notice" that the property would be sold.
Kurt Johnson, the president of the North American Collection Agency Regulatory Association and a senior investigator with the Minnesota Department of Commerce, said it was highly unusual for a collections agency to recover payments through the sale of a home that isn't facing foreclosure.
"Typically, they just put liens on the property," he said. "I've never heard of it in my 20 years in Minnesota, and I've never heard of it in any other state."
North American Recovery's president, David Saxton, did not return several phone calls from ABC News.
Lt. Kendra Herlin of the Salt Lake County Sheriff's Office said that the office generally notifies someone of a sheriff's sale either in person or by posting a notice on the property itself.
Herlin said it was "highly unlikely" that someone would not receive notification that their home was being put up for sale.
Meade, who stressed that he has no firsthand knowledge of the specifics in Ramos's case, said he found it difficult to believe that a person in Ramos's position would never receive any notification.
"The thing that's strange in my mind is her claim that she didn't know this was occurring. I find that hard to imagine, given what has to happen," he said.
But Ramos said that's what happened to her. She said the sheriff's office used an inaccurate legal description of the house and that that kept her from learning of the sale.
"The law is simply unjust when your home can be sold to satisfy such a small debt, when other property exists that could also be sold to satisfy the debt," said Ryan James, of Haskins & Associates, the Salt Lake City firm currently representing Ramos, in an e-mail to ABC News.
No Refuge in Bankruptcy
According to the appeals court decision, Jarmaccc Properties served Ramos, then Sonya Bangerter, with a notice instructing her to move out of her home in May 1998.
Ramos said she never received that notice either.
That same year, Ramos said that on the advice of a previous attorney, she filed for bankruptcy in an effort to reclaim her property.
On that lawyer's suggestion, Ramos said she structured a bankruptcy settlement that would allow her to regain the title to the house after she paid to Jarmaccc the $1,550 the company paid to buy the property.
But Ramos said that after she paid the company, it still would not relinquish ownership of the home.
Ralph Petty of Jarmaccc Properties did not return several calls to his office.
In 2004, Ramos went to court again and attempted to put her name back on the home title. The court ruled in her favor, but Jarmaccc appealed. The Utah Court of Appeals ruled this month that Ramos could not dispute Jarmaccc's title claim because the statute of limitations had expired.
Ramos said she will appeal to the state's supreme court in hopes of winning the house back once and for all.
If she does not regain ownership, it is unclear whether Ramos would have any legal claim to the tens of thousands of dollars spent on mortgage payments while the home was owned by Jarmaccc.
Such cases are rare, but Utah lawyer Meade noted that while a person in Ramos's situation may have been making mortgage payments, the holder of the home's title could argue that it also permitted her to live rent-free, further muddying any claim she might have.
A Silver Lining?
In the meantime, Ramos, who divorced her first husband in 1999, continues to live in the house with her two youngest children and her second husband.
She has continued making mortgage payments and says she only has about $9,000 remaining to pay off the initial loan from the city.
For the last year, Ramos has been working as a home loan officer after taking part in a training program and earning a mortgage lender agent's license from the state.
"I love it because I honestly feel like I have helped a lot of people," she said.
But Ramos said that her newfound avocation isn't the silver lining to her housing nightmare.
"The silver lining," she said, "will be if I get the house."