A Montreal native who moved to New York after a divorce and built a property portfolio, is facing losing it all.
Gisele Allard could end up homeless rather than a millionaire after compound interest on a personal loan used to acquire a Manhattan property escalated.
Bloomberg reports that Allard bought her first property when she arrived in New York and could not afford to live in most neighbourhoods. She found a home in Harlem but was unable to get a mortgage as the home had been used for drug dealing.
Allard secured a $100,000 personal loan from the seller of the $135,000 property.
That was 21 years ago and when the seller died, Allard was unsure where to make loan payments and eventually stopped.
But that led to compound interest mounting up to $8 million.
Now at the age of 75, Allard has sold her home for $1.2 million and two other properties she had bought along the way which were sold at a foreclosure auction for $5.5 million.
She has one more property but could end up losing that too if the courts decide she hasn’t satisfied her debts.
“This will throw me on the street,” Allard said. “I’m very close to becoming homeless.”
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