Watch Out For Financially Strapped Home Builders Nearing Foreclosure Using Lease-Purchase Deals To Unload Unsold Inventory Onto Unwitting Homebuyers

In Bartlett, Tennessee, WMC-TV Channel 5 reports:

• [V]iviana and Alex Cifuentes of Bartlett, TN, negotiated a lease-purchase agreement with John Porter of Precision Equity Homes in Collierville, TN. The Cifuentes agreed to pay $8,000 down on the home Porter's company built [...] in Bartlett's Brunswick Village, a development of Precision Equity Homes.
• Agreeing to reasonable monthly lease terms as well as a furniture purchase from Porter, the Cifuentes moved into the home in January to start the lease, which officially began Feb. 1, according to the agreement.
• March 10, the Cifuentes received the first foreclosure notice from the bank that Porter and Precision Equity Homes had defaulted on the mortgage. "Definitely, his intention was to be able to get this money, and then the house was going to go into foreclosure," said Viviana. "We were played and totally used by Precision Equity Homes," added Alex.
• Court records revealed Precision Equity Homes defaulted on three of its homes, all in the Brunswick Village development, since last summer. At least three banks - First Citizens National Bank, First Capital Bank and Community Bank, North Mississippi - have sued Porter and Precision Equity Homes for breach of contract. Porter denied the allegations in responses to the suits filed by his attorneys.

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• After Action News 5's inquiry into the case, Porter paid the Cifuentes an undisclosed cash settlement. The family will attempt to use that money to negotiate a new agreement with the property's current owner, Regions Bank.

For more, see The Investigators: Lease-Purchase Agreement: Don't Do It! rent to own rent skimming