Cash-Strapped Fairfax County Builder Leaves Customers' Deposits At Risk, Forcing Some To Buy Unfinished Homes At Foreclosure Sales

In Fairfax County, Virginia, The Washington Post reports:

• [S]eville Homes, a small Virginia builder, collected hundreds of thousands in deposits in recent years for homes in Northern Virginia that it never delivered. There are foreclosure filings on 19 Seville properties, according to data collected by ForeclosurePoint, on online listing service, [...]. A $2.2 million five-bedroom home owned by [Seville's owner Stephen] Korfonta personally has also been in the foreclosure process, according to ForeclosurePoint.

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• Seville's struggles have sent would-be homeowners scrambling to protect their investments. The company used the deposits of the homes in foreclosure to fund operations, so it is not able to return the funds, said Brian West, Korfonta's lawyer. "Our hope has always been that the customers would be able to purchase the homes from the bank," West said.

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• Some former Seville clients have bought their homes -- in various stages of completion -- at foreclosure auctions and are now spending thousands more to finish them and to resolve zoning issues. Others are hoping that their deposits, which topped $200,000 in some cases, will eventually be returned. The Fairfax County Police Department is investigating customers' complaints about the loss of their deposits.

For more, see Builder's Troubles Put Buyers in a Bind (Would-Be Owners Scramble to Outbid Banks, Hire New Contractors).

For other posts on homeowners left in the lurch due to actions by builders/contractors, go here, go here, and go here. contractors stiff subs customers yelbow