The financial woes of La Casa de la Raza (pictured) reached a snapping point Wednesday morning as Superior Court Judge James Herman refused to stop foreclosure proceedings on the lower Eastside community center, a Latino hub since 1971. La Casa asked for court intervention on June 16, alleging that Fidelity Mortgage Lenders “took advantage” of La Casa with “grossly one-sided” default interest rates, late fees, and other charges both “arbitrary and inflated.”

La Casa de la Raza
Paul Wellman

Lawyers for Fidelity ​— ​headed up by Wayne Grajewski in Los Angeles ​— ​countered that “what [La Casa] fails to mention is that [since December it] has failed to make any of its monthly loan payments.” With the injunction request, La Casa was asking to “put [the foreclosure] on ice and allow us to settle our differences with [Fidelity],” attorney Matt Clarke told The Independent. Describing his ruling as “not a happy one,” Judge Herman cited “undisputed evidence that [La Casa] is in significant and continuous default. It’s really unfortunate because my view is that it’s a great resource for the community.”

“This is déjà vu, man,” Frank Bañales told The Independent, referring to La Casa’s history of financial precariousness. As the cofounder of the Zona Seca nonprofit organization, Bañales rented space inside La Casa’s building when it was just starting out. “I feel bad for them. La Casa has had a difficult time developing a sustainable revenue source,” even with its rich history of hosting theater groups, Fiesta de la Comunidad, and now-famous bands, such as Los Lobos.

After the court hearing, Grajewski said reinstatement of the loan is still on the table, at a cost of more than $50,000, according to court documents. But from La Casa’s perspective, “without all [Fidelity’s] bogus charges,” it’s a lot closer to $30,000, Clarke said. Also, according to county records, as of June 30, La Casa owes $20,456.80 in property taxes. When asked if La Casa has a potential beneficiary ready to step up, Clarke said, “We will see.” Foreclosure is set for July 20.

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