SBA threatens Md. couple with foreclosure to pay for previous homeowners' loan

(WJLA) - With its stunning view of the Chesapeake and the Bay Bridge in the distance, Catherine Bourassa and Robert McNish’s home on Gibson Island in Anne Arundel County, Md. has long been a beloved retreat.

"We come out here for the summer; spend June, July, August out here," said Catherine Bourassa. "It's just really peaceful, really magical."

But eight years of good times and three bedrooms packed full of wonderful memories are rapidly turning into a bureaucratic nightmare that started with a letter the family received in 2012 from the Small Business Administration (SBA).

The letter warns that the home "is collateral for an oustanding indebtedness," saying the SBA "may initiate foreclosure proceedings in order to satisfy" the loan.

"My first reaction was, this has to be a mistake. This can't really be happening," said Catherine. "We've never borrowed money from the Small Business Administration."

After some digging, it turned out that, after Hurricane Isabel, the previous owners of the home, Richard and Gretchen Snow, borrowed $250,000 from the SBA to cover the costs of repairs to their Alexandria, Va. ice cream parlor -- and they put up the Gibson Island home as collateral.

When the Snows sold the home, SBA provided documents to them that showed the lien would transfer to the Snows' new home.

For some reason, that lien transfer did not go through -- and the Snows defaulted on the loan.

"Rather than go after them, they've decided, since they have the lien on the house, they're going to go after us for the money," Catherine told ABC7.

Lawyers for the SBA would not comment on their efforts to recover money from the Snows, instead directed blame for the situation to the title company that handled the $1.7 million sale of the home back in 2005.

In a statement, In a statement, SBA lawyers referred Bourassa and family as "innocent purchasers, just like any homeowner who buys a home and relies on the title company to clear all liens."

The lawyers added, "The government expects the case to be resolved, and is not planning any foreclosure."

The title company and the SBA are now in a lumbering court battle.

"And we're caught in the crossfire," said Catherine. "They're going after us because we are the little guy, and are the easiest target."

Catherine Bourassa has since been diagnosed with a rare immune system disorder that's left her unable to work. The couple told ABC7 they'd like to sell the house, but can't because of the SBA lien.