After 46 years in one family, the little house in Tahoe Park has its own culture. Brothers, sisters and friends come in the back, and the front doorbell always means strangers.

"This is home," said Stacy Scherbenske, youngest of three children raised in the house near UC Medical Center. "This is all we've known for 40 years."

But the house – owned by Stacy's mother, Rachel Scherbenske, 68 – is now part of a new tradition of foreclosures, bank consolidations and court cases forged by the excesses of the housing boom.

Overextended after a series of refinancings, Rachel Scherbenske is on the verge of losing her home.

World Savings, the lender that sold her the risky pick-a-payment loan that turned out so badly, collapsed under the weight of its bad loans and was bought by Wachovia Bank. Wachovia, which in turn was bought by Wells Fargo, foreclosed on Scherbenske's house in October.

Now, Wells Fargo finds itself fighting in bankruptcy court to finish a foreclosure on a risky loan it never issued. For the moment, at least, the courts have delayed Scherbenske's eviction.

It's just one example of how the personal calamities of homeowners have been caught up in the problems banks inherited in their recent acquisitions.

Lending industry analysts Stuart Feldstein said last year's mergers make sense in the long haul. But right now, he said, new owners have their laps piled high with inherited delinquencies and other issues.

Last week, banking giant JPMorgan Chase, which bought failed thrift Washington Mutual, opened a Sacramento office to help borrowers struggling with WaMu's pick-a-payment loans. It's one of 24 such centers nationally.

Last fall, after being sued by California Attorney General Jerry Brown, Bank of America agreed to rewrite 400,000 subprime and pick-a-payment loans made by its newly bought subsidiary, Countrywide. The rescue operation was estimated at $8.4 billion.

"Bank of America was a pristine prime lender … and they're paying a penalty," said Feldstein, president of New Jersey-based SMR Research.

Pick-a-payment loans, a housing boom favorite, were renowned for hefty broker fees and prepayment penalties that made them a hit with global investors. Now, the risky loans, which tend to grow larger even as payments are made, are a prime source of defaults.

After absorbing Wachovia – and its portfolio of World Savings loans – Wells Fargo immediately mailed 30,000 letters to its new pick-a-payment customers to discuss workout options.

Rachel Scherbenske's house in Tahoe Park had already been foreclosed.

Now the case is playing out in Sacramento-based U.S. Bankruptcy Court for the Eastern District of California, where lawyers from the California Senior Legal Hotline are representing Scherbenske.

Richard Heltzel, clerk of a court that has seen one of the nation's largest increases in bankruptcy filings, said such cases are increasingly familiar.

"Clearly, a very large percentage of Chapter 7 and Chapter 13 is being driven by the housing situation," he said.

Senior hotline lawyers David Mandel and Maureen Sullivan argue that World Savings took advantage of an unsophisticated borrower, who refinanced in 2004 for $137,500, in 2005 for $172,000 and 2006 for $192,000 to pay down credit cards and stay ahead of bills.

Scherbenske contends that part of the reason for refinancing so often was calls from World representatives offering to help her lower her monthly payments.

"They kept after me and kept after me," she said.

Scherbenske said she was assured by World Savings loan reps that the pick-a-payment loan was really a 5 percent fixed-rate loan.

In letters to Wachovia, her attorneys acknowledged "misguided refinancing" and said Scherbenske fell for "sales pitches for lower payments that were so common during the housing bubble."

The hotline attorneys want the bank to rescind the foreclosure and offer a reverse mortgage to allow Scherbenske and her family to keep a home they've known nearly all their lives.

The case has been costly for the bank over months of negotiations. Wells Fargo flew attorney Robert Bailey from Southern California to Sacramento to represent it at a recent hearing.

"The right (to rescind the bank's foreclosure) is not there," he told U.S. Bankruptcy Judge Robert Bardwil. "There is nothing to rescind once the foreclosure happens."

Nonetheless, the judge sized up World Savings' history with Scherbenske and suggested the greater harm is being borne by her and her family. He set a new hearing April 21 to consider a new temporary injunction against eviction.

It's just one case. But Feldstein said it shows how banking giants are struggling – for now – with their acquisitions.

Wells Fargo spokeswoman Aimee Worsely declined comment Friday about the legal proceedings or the case.

And in Tahoe Park, three years after the housing boom, the Scherbenskes await the unknown.

Call The Bee's Jim Wasserman, (916) 321-1102. Read his blog on real estate, Home Front, at www.sacbee.com/blogs.