Former Philadelphia Phillie (and Met) Lenny Dykstra, also known simply as “Nails,” has sued JPMorgan Chase for $100 million over mortgages he obtained during the housing boom.
Dykstra claims he was “fraudulently induced into borrowing more money than he could afford,” leading to his eventual bankruptcy.
The loans were used to purchase former hockey great Wayne Gretzky’s six-bedroom, eight-bath mansion in Thousand Oaks, California for $17.4 million in 2007 and pay off loans tied to another home in Simi Valley, CA.
The second mortgage was due in full after just one year, and was expected to be refinanced, though WaMu apparently reneged on the deal, likely because of the impending real estate crash.
Talk about a debt-to-income ratio fail.
Sounds like he used stated income to get the deal done, considering he was an “entrepreneur” with all types of stuff going on.
Dykstra says he was eventually forced into a number of unfavorable transactions to make good on the $8.5 million mortgage, causing him to take on even more debt.
He was also involved in more than 20 lawsuits related to his entrepreneurial activities, which led to his bankruptcy filing last July.
The Thousand Oaks estate is being listed by Ewing & Associates for a hefty $14.9 million.