Freddie Mac settles with family sickened after moving into former "meth lab"

These images provided by the Hankins family show the home they purchased in Klamath Falls, Ore., that was previously used as a meth lab. Jonathan Hankins

The nightmare may finally be over for Jonathan Hankins. The Oregon man made headlines last October when he tried to take on a mortgage giant after he inadvertently bought a house that used to be a meth lab.

Freddie Mac has agreed to settle with Hankins' family about eight months after they had to flee their home because it was making them sick. Their story gained national attention with the help of a petition on Change.org that ended up gaining more than 210,000 signatures.

"We feel really relieved and really fortunate, and certainly grateful, for Freddie Mac reaching out to us after we received such support from Change.org," Hankins told CBSNews.com Wednesday.

Hankins' cautionary tale began last June after the family purchased a foreclosed "fixer-upper" in Klamath Falls, Ore. from HomeSteps.com, a listing site for Freddie Mac-owned properties.

Within days of moving in, Jonathan said he began experiencing severe dry mouth unlike he'd ever had before and soon his wife Beth, an emergency room nurse, also developed severe dry mouth along with mouth sores. Beth soon developed breathing problems, while Jonathan had painful sinus migraines. Both felt disoriented. Then, they noticed their son Ezra, 2-years-old at the time, was acting strange, telling his parents he was thirsty, but refusing water because it burned when he tried to drink it.

"The neighbors said, 'It's probably the meth,'" Jonathan said in October when relaying his story to CBSNews.com.

It turns out, the previous tenants illegally cooked methamphetamine at the home. Jonathan said the Hankins moved out about two weeks after moving in, and their symptoms subsided.

Chemicals used to make meth are highly toxic, especially if they're stored and disposed of improperly.

Homeowners in Oregon are required by law to disclose if a home was previously used to produce dangerous drugs, but listing companies like Freddie Mac may not be aware of this information.

The Hankins had to get rid of all of their furniture and rent a new house while keeping the potentially dangerous property they couldn't afford to get cleaned.

Deterred by fees required to mount a legal challenge, Jonathan and Beth started the petition at Change.org last October to ask Freddie Mac to pay for the house and its decontamination. They also called on the company to regularly test its homes for meth residues.

At the time, Freddie Mac spokesperson Brad German told CBSNews.com the company relies on listing brokers to disclose information about the property's history.

"We're very empathetic, this isn't what we look for in a sale," German said in October. "But the buyers were given every opportunity to do an inspection or conduct any test they wanted to conduct."

This week, Change.org announced that Freddie Mac decided to settle with the family for an undisclosed sum.

"After speaking to the Hankins and hearing their concerns first hand we were able to work closely together and come to a mutually agreeable resolution," German said in an emailed statement. "We will continue to review and update our policies to protect our buyers and their confidence in HomeSteps homes."

Jonathan said he was especially thrilled that Freddie Mac agreed to take another look at its policies.

"We're grateful for the settlement, but we're really excited for the fact that they're willing to review and update their home policies," Hankins said of Freddie Mac.

He is now sponsoring an Oregon state bill that would require a warning to be posted on foreclosed and bank-owned homes that have not been tested for methamphetamine residue, so owners will know if they need to conduct their own testing.

Hankins' son Ezra just turned 3-years-old and is a happy, healthy boy, according to his dad. He concedes he still fears for any long-term effects to his son's health from their experience. Now, he said he devotes his time to getting this bill passed so other families don't have to endure the trauma his family did.

"This happened to us for a reason, because we wouldn't just let it go," Jonathan joked.

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