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It’s the Harlem shuffle.

An elderly woman who owns four Harlem brownstones may end up homeless because of a massive debt on one of the properties that has ballooned beyond control.

What began as a $100,000 mortgage 20 years ago on a dirt cheap piece of property along a crime-ridden uptown street has escalated to the most ludicrous of liabilities at more than $7 million.

And, now, Giselle Allard, 75, who once had her choice of spacious homes to live in, is being forced to sell at least some of her properties to pay off the astronomical debt.

“They want to take over everything I have,” Allard told the Daily News. “It’s sad. I’m in the process of being homeless over a debt that was not addressed properly.”

At issue is a brownstone Allard bought in 1998 for $135,000 at 50 E. 126 St. Allard, according to court papers, put $35,000 down and reached an agreement directly with the owner, Robert Robinson, to pay the rest, $100,000, over the next 10 years.

But just a few months later, Robinson died, leaving Allard confused, she said, about where to make the payments. Allard said she tried to make several payments to Robinson’s lawyer, but when the checks went uncashed, she stopped sending them altogether.

Further complicating the situation, according to Allard’s lawyer Robert Strougo, is her claim that Robinson requested she stop making payments. Strougo said Robinson feared the hospital where he was being treated would seize the money to pay down his hefty medical bills.

“The whole situation is insane,” said Strougo, who has asked a Manhattan judge to issue an emergency order to modify the foreclosure judgment. A hearing on the motion is scheduled for Thursday.

The claim that Robinson asked Allard to stop making payments is not mentioned in the various court papers reviewed by The News. When asked why, Strougo said he was not representing Allard at the time that payments were argued in court.

Nearly a decade passed before anyone tried to collect from Allard, and when they did, the bill was a doozy. Instead of the 6% interest she signed off on in the agreement, Allard was being charged 25% as a penalty for allegedly defaulting on the loan.

In 2009, a court-appointed referee tallied Allard’s bill to nearly $400,000, which, looking back, seems like a bargain.

A look at the exterior of 32 W. 120th St. in Harlem, owned by Giselle Allard.
A look at the exterior of 32 W. 120th St. in Harlem, owned by Giselle Allard. (Gregg Vigliotti/for New York Daily News)

But, according to court papers, lawyers for the executor of Robinson’s estate, a relative named Jocelyn Davis, argued that the debt should be 25% interest compounded monthly for the 10-year life of the loan — and every month since. Almost a decade after the referee’s recommendation, Manhattan Supreme Court Judge Judith McMahon accepted the calculus offered by Davis’ legal team in a decision last September.

Davis’ attorney Adam Mikolay declined to comment for this article. Strougo told The News that Davis’ legal team dragged its feet for years, and that when it eventually did make it in front of Judge McMahon, she either overlooked or misunderstood the provision to allow for compounded interest.

“Their lawyer slid it past the judge,” he said.

McMahon referred calls to the Office of Court Administration. An OCA spokesman declined to comment citing the ongoing legal wrangling.

To pay down her debt, Allard’s building on E. 126th Street was auctioned off on Aug. 21 for $1.2 million, though the sale has not yet been finalized. Her other properties, which include three other historic Harlem buildings, could soon face similar fates. Two are set to go on the auction block on Sept. 12.

Allowing such high interests rates is rare, according to lawyers with expertise in mortgages.

“It rarely goes up to 25% . Usually there’s a default interest rate of 12%,” said Steven R. Wagner, a lawyer with more than 30 years of experience in real estate law. “There are exceptions … It might fall into one of the exceptions.”

In Allard’s case, instead of the interest being based on the principal amount of the loan, as it is with most mortgages, the interest was being charged on the principal plus the interest that was accumulating every month.

Based on that, the debt was more than $5 million as of early last year, an amount signed off on, according to court documents, by a court-appointed arbitrator and Judge McMahon.

Estimates since then have the debt more than $7 million, including taxes, fees and penalties.

Based on court papers filed by Mikolay and Davis, they clearly suggest Allard was well aware of what she was doing.

“The now deceased, unsophisticated Mr. Robinson, sold the subject premises … to the very sophisticated, licensed real estate broker, defendant Giselle Allard,” Mikolay argued in one motion filed last year. “The defendant signed a note and mortgage memorializing the agreement. The defendant never made a single payment as promised.”

Court records also paint a picture of a woman who hired a drug addict to work as a handyman at E. 126th St., has failed to file tax returns since 2012 and did not hire an accountant after promising she would.

Davis’ legal team also claims in court records that Allard has never made any effort to pay the debt or settle the dispute after the estate began trying to collect.

Strougo disputed this. He claims in his latest filing that Allard recently discovered a ledger documenting payments to Robinson and his lawyer when Robinson was still alive. He said that banks would not have proof of transactions from the time because they don’t maintain records that old. The filing also denies that Robinson was ever a real estate broker.

The arbitrator declined to comment.

A later bankruptcy proceeding determined that Allard — who is listed as having a net worth of $11.4 million, consisting primarily of the value of her real estate — would have to sell off at least some of her property to raise the money to pay off the debt.

“To think I can be homeless in a month from now is very sad,” Allard said. “People are losing their homes over tiny, little debts. We need to pay attention.”

Friends and neighbors describe Allard as a stubborn woman who lacks attention to detail but means well. For years, she used the properties as hostels for foreign students to earn a little money and to balance out the drugs and violence that plagued her corner of the community.

“She put the property to good use,” said Joel Meyer, a legal consultant who began helping her after a dispute with one of her attorneys. “She was very much a contributing member of the community.”

239 Lenox Ave. (corner building) in Harlem, owned by Giselle Allard.
239 Lenox Ave. (corner building) in Harlem, owned by Giselle Allard. (Gregg Vigliotti/for New York Daily News)

But according to court testimony she gave in February, three of her buildings are vacant, one since as far back as 1999.

Still, Meyer said the debt should not be more than $600,000 or $700,000, which she could probably pay by selling off only one of her buildings.

“She’s being stripped of everything she has and being thrown into a condition of abject poverty and homelessness,” Meyer said.

Allard’s friends put it differently. They say she’s being robbed.

“Vultures, snakes, dogs and raccoons are coming after this woman,” said neighbor and friend Gena Lovett, a tax consultant who is helping with some of Allard’s finances.

Lovett and other financial advisers said Allard should have paid into an escrow account after Robinson died so she could have the money on hand when someone came to collect. She didn’t. Still, they said the price she is paying now for her negligence is way too high.

“This is as shady as I don’t know what,” Lovett said. “It’s such a sad, sad story. I don’t think I ever have seen someone taken advantage of the way this woman has.”