"I just want to walk away from this without losing the house that I worked hard to get," said Cole, an electrician who said he never missed a payment.
Combined, $940,500 in mortgage money for the five went missing as an alleged Ponzi scheme folded, according to the lawsuit.
"It seems pretty absurd that they would hold us responsible," said Graziani, who is receiving mortgage bills from two banks that have put liens on his Mayfair home. Both banks say he owes them $166,000.
"There's no way in the world that they're going to find any wrongdoing on our part. We're victim to all this," said Graziani, a financial analyst for Lockheed Martin. "I'm paying my mortgage."
The lawsuit alleges the money was "stolen" by two Somerdale firms, the now-defunct Capital Financial Mortgage Corp. and Park Avenue Abstract Inc., both owned by David Fili and George Barnard, both of Delaware County. Stonegate Mortgage Co. of Mount Laurel wired the funds to pay off the first mortgages. Stonegate alleges it was scammed as well.
In May, Stonegate sued Capital, Park Avenue, and Commonwealth Land Title Insurance Co., which attorneys said should protect the homeowners and Stonegate. Stonegate alleges at least 20 of 69 loans purchased from Capital were fraudulent.
Messages left for Fili, Barnard, and their attorneys were not returned. A representative for Stonegate said he could not comment on pending litigation.
In an interview Tuesday, Graziani, 36, said he refinanced at 2.75 percent for a 15-year loan, a $300 monthly savings from his 3.75 percent loan with another bank.
According to the lawsuit, the homeowners refinanced with Capital between February 2012 and March 2013.
Capital sold Graziani's loan to Stonegate, using Park Avenue as the title company. According to the lawsuit, Park Avenue took the money to pay off Graziani's mortgage out of escrow and put it into a Capital account.
According to the lawsuit, Stonegate was among the banks that wired money to Park Avenue. The money was to pay off the previous mortgage. Instead, the money was removed from an escrow account and transferred into a Capital account. Capital then made monthly mortgage payments instead of paying off the loan, the lawsuit alleges.
When Capital stopped making payments, the homeowners were notified that they were in default. Meanwhile, Stonegate advised the homeowners that it was time to start paying off their new mortgages.