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It’s a Scam: Land Contracts on Uninhabitable Houses - The Business Journal

The visual might be comical if it weren’t so sad. Behind the disintegrating front porch roof at 226 E. Lucius Ave., on the front door hangs a sign advising that the property has been winterized. Just a few yards away, a tree grows through an attached trellis. The house, owned by Vision Property Management, a South Carolina company, provided the backdrop Friday for a news conference to outline legislation introduced by state Rep. Michele Lepore-Hagan to regulate land contracts. Vision, along with Harbour Portfolio Advisors in Texas and other out-of-town firms, own properties in Youngstown and elsewhere in the Mahoning Valley. Many of these properties are under land contracts that critics say offer predatory terms. “Companies have swooped into Ohio and other states devastated by the collapse of the housing market, bought homes for pennies on the dollar, inflated the values of the homes, then enticed borrowers into entering into a high-interest, long-term loan that they have little if any chance of ever repaying,” Lepore-Hagan said. “They employ a series of predatory tactics and practices,” said Ian Beniston, executive director of Youngstown Neighborhood Development Corp. “They require the occupant – the vendee – to make all of the repairs and they charge interest rates well above market, into the double digits.” The companies also inflate the values, selling a property they bought for $3,000 for $30,000. “These companies are picking up on the wreckage of the foreclosure crisis, buying properties and using unregulated predatory practices to take advantage of people, particularly low-income people,” he continued. “They target minority neighborhoods the most.” To read the full story from The Business Journal, click here.