Bipartisan state delegation to introduce bills fighting predatory land contracts

Bills intended to protect individuals who buy homes

By Graig Graziosi


State legislators announced plans to introduce companion bills aimed at fighting predatory land installment contracts.

State Reps. Michele Lepore-Hagan of Youngstown, D-58th, and Don Manning of New Middletown, R-59th, joined state Sens. Michael Rulli of Salem, R-33rd, and Sean O’Brien of Bazetta, D-32nd, on Monday at the Mahoning County Courthouse to announce the upcoming legislation.

The bills – collectively called the Fair Lending through Contracts Act – are intended to provide protection to individuals who purchase homes through land installment contracts.

“Predator lenders have proven time and again that they’re willing to exploit and profit from vulnerable individuals who are looking for housing,” Lepore-Hagan said.

The proposed legislation – similar to Lepore-Hagan’s House Bill 368, which has been tied up in committee since 2017 – would require contracts between property owners and the prospective homeowner to be on record at county recorders’ offices, and makes landlords responsible for repairing their properties and making them habitable, providing inspection records and certificates of compliance and proving that all liens and code violations are alleviated on the property before execution.

Equity relief for individuals who are evicted while under a predatory land installment contract also will be worked into the bill, according to the delegation.

Under land installment contracts, prospective owners pay rent to a seller for a predetermined number of years before having the option to purchase the property.

Some contracts, however, push the burden of maintaining, repairing and dealing with financial issues attached to the property onto the renters. This forces the risks of home ownership onto the renters, who may pour thousands of dollars into repairs or agree to rent a property that is, unknown to them, in foreclosure.

“These out-of-town companies come in here and prey on working-class people,” Rulli said. “They’re taking their money and then kicking them out of their houses.”

“We’re trying to get land contracts more in line with the standards that banks and other traditional lenders have to follow,” Manning said.

Land installment contracts, and more recently rent-to-own and lease-to-own contracts, became prominent in poor communities after the housing collapse of 2008.

According to the delegation, companies such as Vision Property Management of South Carolina and Harbour Portfolio Advisors of Dallas purchased cheap properties in cities such as Youngstown, Warren and Akron, inflated their value and marketed the properties specifically to first-time, often low-income, prospective homeowners.

Youngstown City Council will vote Wednesday evening on an ordinance aimed at curbing predatory land contracts in the city.

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