A company with a house-flipping business model is accused of deceiving and manipulating homeowners throughout the nation.
Dallas-based HomeVestors of America, which advertises as “We buy ugly houses,” has 1,150 franchises in 48 states. The “largest homebuyer in the United States,” it allegedly has preyed on elderly people whose mental capabilities were diminished, targeted families undergoing hardship and deployed various lies for its own benefit, ProPublica reported.
An example of HomeVestors’ alleged unethical practices is a 2016 case in which Cory Evans of Patriot Holdings, one of the company’s franchises, bought 82-year-old Corrine Cassanova’s three-bedroom home in suburban Los Angeles after making a lowball offer.
Casanova had dementia and was incapable of complex negotiation. Her son, David, was outraged and tried to cancel the sale, but Evans already had the house under contract. Evans said Casanova showed no signs of impairment during their deal. David Casanova has sued Patriot Holdings alleging elder abuse.
HomeVestors and its franchisees say they help homeowners out of jams, buying properties on the brink of foreclosure, in need of major repairs or mangled by natural disaster.
They targeted people who have recently divorced, had a death in the family, lost a job or face another situation that necessitates a quick sale. Franchises also looked for families with children in need of surgery. That’s part of the company’s Sandler system — a sales strategy aimed at building rapport with homeowners in order to “find the pain,” the outlet reported
Once those situations are identified, HomeVestors goes in for the hard sell, the outlet reported.
One Texas resident, whose father had been murdered, said she received letters so persistent that checking the mail became a traumatic experience.
HomeVestors employees allegedly also displayed a pattern lying to clients in pursuit of deals. A woman in Fort Worth said a franchisee told her she could legally sign a contract to sell her late husband’s house even though she wasn’t on the deed. A man in Florida thought he was signing a document for a home equity loan that was actually a contract to sell his $100,000 house for $37,500, the outlet reported.
“You were always lying to them. That’s what we were trained,” Katie Southard, a former franchise owner in North Carolina, told the outlet. “There was a price that you could pay, but you would always go lower and tell them that was the price you could pay.”
In addition to Cassanova, HomeVestors allegedly lowballed a slew of other senior citizens who were unequipped to engage in real estate negotiations. An 83-year-old Georgia woman who had suffered several small strokes, sold her house to a franchise for $82,111, then spent her last three years of life agonizing over money, the outlet said.
A HomeVestors spokesperson denied claims of deceit and preying on the elderly, saying the company doesn’t tolerate such behavior. The deals ProPublica uncovered represent a tiny fraction of the company’s overall transactions, which have totaled more than 71,400 since 2016, and that the company boasts a 96 percent approval rating, the spokesperson said.
—Quinn Donoghue
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