Texas-Based Real Estate Slum Operator Notorious In Houston & Buffalo For Peddling Crappy Rent-To-Own Deals To Unwitting Wanna-Be Homebuyers Hit With Baltimore Suit Alleging His Business Model Presents Nuisance That Threatens Communities' Well-Being

In Baltimore, Maryland, Baltimore City Paper reports:

• Backed by the non-profit Community Law Center,(1) six Baltimore neighborhood associations have sued a Texas-based property speculator for $8 million, saying his business model presents a nuisance that “threatens the well being of the communities.”
  
  The defendant, Scott Wizig, owns about 140 city properties, plus dozens more in Houston, where he is based. In the early 2000s he was charged criminally by the state of New York and dubbed “Buffalo’s worst slumlord,” eventually settling the case for several hundred thousand dollars. He started buying in Baltimore in 2001; City Paper took note of him three years later and not much has happened in the nine years since then.
  
  “He first got our attention with the ‘We buy houses’ signs,” says Kristine Dunkerton, the Community Law Center’s executive director. “He racked up quite a bill with the city for posting the signs. But he never did anything with the properties.”
  
  (Baltimore city strengthened its ordinance against so-called bandit signs in 2006. The city’s housing department enforces the ban, though with difficulty according to this 2009 City Paper story).
  
  Wizig buys run down houses via tax sales, paying just a couple thousand dollars each for houses that are arguably worth even less, because most need expensive rebuilding to be habitable. In the early 2000s he was renting them to tenants for about $500 a month through a local property manager. City Paper found tenants who said promised repairs were never made. The manager and Wizig blamed each other and Wizig said he was getting out of the rental business then: “We don’t anticipate doing any more rentals with new customers [in Baltimore], but we are certainly going to look into and make sure the existing customers are being taken care of.”
  
  In Buffalo and Houston, Wizig’s business model revolved around a lease-to-own contract, often one that required the lessee to rent for a couple of years before being able to exercise their option to buy the property. Houses Wizig picked up for a couple grand would routinely be sold for ten times that—though the buyers often defaulted, beginning the cycle anew.
  
  New York prosecutors called the scheme deceptive; Wizig eventually pleaded guilty to hundreds of violations of state housing laws there. The Houston Press, an alternative weekly, wrote about Wizig’s deals in Houston, though he has apparently faced much less legal trouble there.
  
  Land records indicate that Wizig has sold many houses in Baltimore, financing the purchase through one of his companies. It is unclear in the documents whether these are rent-to-own deals. But Wizig’s buyers do not always fare well, and Wizig is himself a defendant in five open foreclosure actions listed in Baltimore courts. The oldest, filed in August of 2011, involves 4046 Park Heights Ave., which a Wizig company called Compound Yield Play sold to Joan E. Lilly in 2008 for $43,200. Wizig had bought the property two years earlier for $2,202.
  
  Another house Wizig sold to Lilly, 1419 E. Federal St., is now in receivership after city action. Wizig’s bought it for $4,396 in 2006 and sold it to Lilly in 2008 for $39,900.
  
  Wizig did not return City Paper’s phone call.
  
  Wizing’s buyers and business partners are not party to the suit. Instead, neighbors of the dilapidated properties are suing under a law called The Community Bill of Rights. The law is more than a decade old, but amended only last year to make it usable to community associations, Dunkerton says. “We decided with the new Community Bill of Rights legislation . . . to put the community in the shoes of code enforcement.”

For the story, see Fed Up: Community associations sue problem landlord for millions.

(1) Community Law Center, a nonprofit law firm, provides legal services to community and nonprofit organizations throughout Maryland to promote stronger nonprofits and more vibrant neighborhoods.