LUTZ, Fla. (AP) – Sept. 8, 2009 – Every day, Mary McCarthy must drive past the finished dream home in her front yard to the mobile home where she has lived for 20 years.

The new home was finished in February, but she can’t move in. The home is not legally hers, though it sits on her property.

The best she can do is open the front door and feel the rush of the air conditioning that she is paying for so mold won’t grow inside.

“I didn’t lose my job; I haven’t defaulted; I didn’t buy something I can’t afford,” McCarthy said, fighting back tears. “We’ve been waiting all these years for this. This isn’t right.”

McCarthy’s empty home is a symbol of poor timing amid the worst mortgage crisis in decades. As property values plummet, those caught midway through new home construction learn an awful fact: They can’t find a lender willing to give them a loan.

The three-bedroom, 1,800-square-foot home is in limbo.

Just before the closing, the lender backed out, saying the home was no longer worth the original loan amount. The builder hasn’t been paid and has sued the lender. McCarthy can’t find another lender willing to give her a loan and now faces liens on the one-acre property.

As unusual as the situation sounds, Jennifer Doerfel, executive vice president of the Tampa Bay Builders Association, said she is not surprised.

As home values continue to fall, lenders increasingly are deciding not to fund loans for new homes — even those that are partially or completely finished — because they’re worth so much less than the originally agreed upon loan amounts.

While values may have fallen, Doerfel said, they are lower because nearby foreclosures are artificially dragging them down.

Unlike owners of some foreclosed properties, the McCarthys can afford their payments.

“They’re not comparing apples to apples,” Doerfel said. “In many cases, the homes in foreclosure have mold and damage. They are not comparable to the new home.”

In other cases, lenders that have gone out of business leave behind customers who cannot obtain new loans.

In McCarthy’s situation, her home was estimated to be worth about $266,000 when Wells Fargo agreed to fund the loan in early 2008. An interim lender agreed to fund the construction loan.

She was to borrow $233,000 — enough to pay for the builder and pay off the $55,000 mortgage on her family’s mobile home. That amount included the property.

The problem arose when Tampa-based builder, AllState Homes, finished the home and submitted the bill to the lender.

“We both were sent letters that they would no longer fund the loan. They say the home is only worth about $196,000, and that was in February,” McCarthy said.

She said other lenders tell her the same thing: “We can’t lend you more money than the home is worth.”

New credit standards are another hurdle.

McCarthy, who has two children and a disabled husband at home, no longer qualifies under new, more stringent guidelines.

“Nothing changed with my credit,” McCarthy said. “I feel the lender should have grandfathered us in. We qualified when we agreed to buy this home.”

McCarthy continues to maintain the landscaping around her dream home. Friends gave her palm trees and decorative rocks as housewarming gifts. She sneaks peeks of the inside of the home through windows.

“This is our grandson’s room,” she said recently, pointing through a window. “The builder let us paint the walls. We chose red for him.”

Everyone in the family had decided where they wanted their furniture.

“They don’t understand,” she said. “The little one keeps asking why he can’t move in.”

John Thresher, a Tampa attorney who represents AllState, said his client is pursuing litigation against one of the lenders involved and can’t comment on the case.

McCarthy’s attorney, Holiday-based Larry Gonzales, said his client also feels bad for the builder, who “built a great home in the time frame he said he would and deserves to be paid.”

The only thing the McCarthys are guilty of, he said, is bad timing. If the home had been completed before the financial meltdown, there wouldn’t have been any problems with the loan, Gonzales said.

“We see all these lenders getting bailouts, and we see help for some people in foreclosure,” he said. “These are real victims. They did nothing wrong.”

All this sounds familiar to Carol Robinson of Ocala. She, too, decided to build a home on land where she lives in a mobile home.

When her lender, Ocala National Bank, shut its doors in January, the lender that took over did not want her construction loan.

Instead of going through a builder, Robinson had hired subcontractors to do all the work, one part of the home at a time. The home is now 60 percent complete, and she doesn’t have the money to finish it.

“I’ve been to Regions, Bank of America, SunTrust, every bank I can think of,” she said. “They all tell me no. The home’s value has dropped.”

Real estate attorneys say there is no concrete advice they can offer consumers in these situations. Every case is different and many will likely have to be worked out in court.

“It’s easier for a big bank to say, ‘No, I’m not going to lend, now sue me’ then to fund a loan that isn’t worth the loan amount,” said Timothy Kingcade, a Miami lawyer who represents homeowners in housing matters. “It’s a sad situation.”

As for the McCarthys, they continue to seek financing and will continue upkeep on the home the best they can, hoping they’ll one day move in.

“The worst part,” she said, “is seeing it every day.”