When State Supreme Court Justice Stephen Bucaria in Mineola unfroze Lend America’s bank accounts to fund only 27 out of 67 disputed loans, there was a reason for it.

The defunct Melville lender’s “warehouse” line of credit, from San Francisco-based Gateway Bank, had funded 27 of the refinance loans but not the others. A “warehouse lender” gives mortgage companies short-term funding for loans, usually on a loan-by-loan basis.

It’s not clear why the 40 others closed if no funding had been identified and why Lend America did not pay off the borrowers’ lenders, even a month or two after the closing. It’s also not clear what happened to Gateway’s $3.7 million or so for the 27 loans after it sent the funds to Lend America.

All this has led to confusion, with borrowers not knowing whether to pay their original loans or Lend America, whose loan servicer has been demanding payments. Some borrowers have paid both sets of loans because they don’t want to ruin their credit records with mortgage delinquencies.

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The court case was filed by EAM Land Services, a Syosset-based title insurance company, against Lend America. Company executive Eric Fein said Lend America provided fronts of checks, overnight mailing labels and other documents that pointed to the original lenders being paid off in the refinance deals. So the company recorded Lend America as a lien holder on the titles, he said, but the proof of payoff turned out to be fraudulent.

Lend America closed Dec. 1 after federal authorities filed a civil fraud suit and barred it from making federally-insured loans. Its executive vice president Michael Ashley has denied charges.