Welcome to The Home Equity Theft Reporter, a blog dedicated to informing the consumer public and the legal profession about Home Equity Theft issues. This blog will consist of information describing the various forms of Home Equity Theft and links to news reports & other informational sources from throughout the country about the victims of Home Equity Theft and what government authorities and others are doing about it.
Thursday, July 13, 2017
Atlanta Legal Aid Tags National Real Estate Investor With Lawsuit For Allegedly Screwing Over 17 Would-Be Homeowners By Unloading Dilapidated, Formerly Foreclosed Homes On Them Using Predatory 'Contract For Deed' Sale Agreements
In Atlanta, Georgia, the Atlanta Journal Constitution reports:
A lawsuit filed in federal court accuses a Texas firm of preying on would-be homebuyers in Atlanta.
The suit, filed in U.S. District Court, includes 17 plaintiffs, who say they were misled by Harbour Portfolio and associated companies into thinking they were becoming owners when they signed agreements that effectively made them renters.
Harbour targeted black areas with the deals, known as “contracts for deed” or “land contracts,” which gave the plaintiffs “all of the obligations of homeownership with none of the rights,” according to the filing.
Officials at Dallas-based Harbour declined comment Thursday.
Several years ago, the company purchased thousands of foreclosed homes in a number of cities. They still own scores of homes in Atlanta, virtually all of them in African-American neighborhoods, according to Kristen Tullos, an attorney with Atlanta Legal Aid, which is representing the plaintiffs.
“This is the most recent development in predatory lending,” she told the AJC. “They are targeting neighborhoods that have been hit time and time again.”
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The lawsuit cites a University of Texas study found that over the course of two decades, about 45 percent of contract for deed purchasers defaulted. Fewer than 20 percent received a deed for the property.
In Fulton County, Harbour bought 85 properties between 2011 and 2015, according to the lawsuit. Of those purchasers, 34 have faced eviction.
It is not the first time that the company has been called out for what critics see as predatory practices. In April, the city of Cincinnati sued Harbour, alleging that the firm owed more than $360,000 in unpaid fines, fees and violation notices.
The city has charged the firm with failing to maintain homes, a neglect that the city says is linked to lead poising in a child.
Last year, the federal Consumer Financial Protection Bureau filed a lawsuit in federal court against Harbour for actions in more than a dozen states. Regulators recently complained that Harbour has been complying with the subpoena too sluggishly.
Among the plaintiffs are some who are still in the houses owned by Harbour and some who have left or been forced out, said Tullos.
Harbour and others who use “contract for deeds” have argued in the past that the purchases typically have tainted credit histories, as well as limited or spotty income, so they are unable to get a mortgage.
The companies have argued that the “contract for deed” is a bridge to homeownership.
Only that, Tullos says, is not what happens. Instead, they are set-up for failure, while thinking they already own a home.
“The companies make it difficult for aspiring homeowners to ever achieve the goal of ownership – which is what they think they are doing,” she said. “None of the people in this lawsuit understood. They believed they were becoming homeowners and they later found out they were functionally renters. That was devastating.”
The lawsuit, argues that Harbour has violated both federal and Georgia law asks that a court order Harbour to pay damages, but does not request a specific figure. The suit also asks that the court declare the plaintiffs to be the owners of the properties where they have been living.
CBC News: Betrayal of Trust (A CBC investigation reveals how lawyers across Canada have misappropriated and mishandled clients money, to the tune of tens of millions of dollars, or sometimes even charging vulnerable people top dollar for shoddy services)
Land Contract/Contract For Deed/Rent-To-Own Rackets
The New York Times: The Housing Trap (In the wake of the housing crisis, low-income families have turned to seller financing to buy homes but these deals can be a money trap)
Beware The Fine Print: Consumers Forced To Sign Away Their Rights To Use Court System
The NY Times: Arbitration Everywhere, Stacking the Deck of Justice(Part 1 in series examining how clauses buried in tens of millions of contracts have deprived Americans of one of their most fundamental constitutional rights: their day in court)
Foreclosure Mills' Abysmal Record In Complying With New NYS Foreclosure Requirements
Justice Deceived: How Large Foreclosure Firms Subvert State Regulations Protecting Homeowners
MFY Legal Services Report On Questionable Practices By Process Servers In Debt Collection Cases
Justice Disserved: A Preliminary Analysis of the Exceptionally
Low Appearance Rate by Defendants in Lawsuits Filed in the Civil Court of the City of New York
Mortgage Mess Redux: Robo-Signers Return (A Reuters investigation finds that many banks are still employing the controversial foreclosure practices that sparked a major outcry last year)
CNN Video: As Foreclosures Mount, Florida Court Turns To 'Rocket Docket'
The Wall Street Journal: A Florida Court's 'Rocket Docket' Blasts Through Foreclosure Cases (2 Questions, 15 Seconds, 45 Days to Get Out; 'What's to Talk About?' Says a Judge)
"Produce The Note" Strategy When Dealing With Missing Promissory Notes In Foreclosure Actions
ABC Video: Fighting Against Foreclosure (Some homeowners have found a new tactic to keep the banks at bay)
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