Federal authorities on Wednesday (Dec. 20) sued Houston-area developer Colony Ridge, accusing it of luring Latino home buyers into seller-financed mortgages and setting them up to default and face foreclosure.
The developer of the subdivisions that cover about 33,000 acres of land about 30 miles north of Houston used Spanish videos to target prospective Latino buyers. Once a person visited the property, Colony Ridge allegedly used high-pressure sales tactics, required minimal down payments and extended loans without assessing a buyer's ability to repay or verifying their gross income.
The company also misrepresented facts — such as guarantees of water, electricity and sewer hook-ups — "causing borrowers to incur substantial unanticipated expenses after closing", federal officials said. Once a buyer fell behind on payments, the company bought the land again and repeated the process — sometimes multiple times with the same piece of property, federal authorities described at a Wednesday news conference.
"Colony Ridge set out to exploit something as old as America: An immigrant's dream of owning a home," said Alamdar S. Hamdani, the U.S. Attorney for the district that covers Houston. "As alleged in the complaint, Colony Ridge's exploitative practice began with misleading advertisements on platforms like TikTok and often ended with families facing economic ruin. No home — and shattered dreams."
A spokesman for Colony Ridge said the company would comment on the lawsuit later.
-This article was originally published by The Texas Tribune
