It seemed like just another successful Florida real estate transaction, one more deal completed without a glitch. A lawyer's employee had found a house she could afford, closed on the transaction, and moved into her new house. Attention had shifted to making the house a home, giving it a warm, lived-in feeling.

And then the nightmare began. Mellon Bank, the lender, eventually canceled the loan. "The bank was doing something that's fairly typical, some internal quality control, some post-closing underwriting," says Ron Sadaka, vice president and division manager of the Wall Street Mortgage Group, a mortgage brokerage firm in Boca Raton, Fla. "In this case, Mellon called the woman to do some due diligence, to check her tax returns.

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