The city of Cincinnati announced a lawsuit against Harbour Portfolio Advisors, one of the nation’s largest sellers of foreclosed homes, due to more than $360,000 in unpaid fines, fees and violation notices, along with alleged failure to properly maintain dozens of homes, according to an article in the New York Times by Matthew Goldstein and Alexandra Stevenson.
From the article:
The lawsuit against Harbour, which is based in Dallas, is the first of several that Cincinnati plans to file against out-of-state firms that acquired rundown homes in the wake of the housing crisis and then resold them at inflated prices without making repairs.
“We are planning more litigation,” said Jessica Powell, chief counsel in the Cincinnati Law Department. Her department has set its sights on firms with “even more egregious business practices,” she added, without naming specific companies.
The company is already in the hot seat after a judge granted the Consumer Financial Protection Bureau permission earlier this year to pursue an investigation into it.
The coverage, also from Goldstein and Stevenson, explained that the bureau has been looking into whether the terms of some of these sales violated federal truth-in-lending laws.
This latest update shows that Cincinnati is now cracking down on private investment firms that sold foreclosed homes on high-interest installment contracts to poor residents who could not get traditional bank mortgages.
From the article:
Investment firms like Harbour scooped up the run-down, foreclosed homes at bargain prices, selling them to families who could not get conventional mortgages but were desperate to own homes.
Cincinnati is seeking to prevent Harbour from selling additional homes to investors until the firm remedies all the outstanding building code violations at the properties it is selling.
As Goldstein and Stevenson note, Harbour Portfolio was previously the subject of a Times investigation into seller-financed home sales, also called contract for deed sales.