-16-
Some of petitioners' personal expenses were paid with funds
from Coastline.
Saddle Rock and Martis Landing
On March 6, 1990, petitioners withdrew $80,000 from
California Federal account number 5272. Petitioners loaned
$88,800 ($8,800 represented interest) to Lee and Catherine Wood
(the Woods) by note dated March 7, 1990 (the March 7 note). The
March 7 note was secured by a deed of trust on the Woods'
property at 25881 Saddle Rock Place, Laguna Hills, California
(Saddle Rock).
On April 20, 1990, petitioner withdrew $50,000 from
California Federal account number 5272, and petitioners loaned
$55,500 ($5,500 represented interest) to the Woods. The Woods
gave to petitioner a $55,000 note (the April 20 note). The
April 20 note was secured by two deeds of trust, one on Saddle
Rock and the other on 1114 Martis Landing, Truckee, California
(Martis Landing).
Because of financial problems, the Woods could no longer
continue to pay their liabilities to petitioners. On June 19,
1991, the Woods and petitioners entered into an agreement whereby
the Woods conveyed Martis Landing and Saddle Rock to petitioners
by deeds in lieu of foreclosure. In return, petitioners released
the Woods from the March 7 note and the April 20 note.
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