Predatory contracts exploit Mahoning Valley home buyers - WFMJ.com News weather sports for Youngstown-Warren Ohio

Predatory contracts exploit Mahoning Valley home buyers

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YOUNGSTOWN, Ohio -

The faith-based group ACTION is standing behind legislation to stop predatory land contracts in Ohio, where a homeowner pays for their home until they could be evicted.

The group stood in front of a house on 226 East Lucius Avenue Friday where the buyer was paying on an agreed land contract, only to find the home was in foreclosure.

The property is owned by someone out of state and cannot be lived in. 

Land installment contracts, once a tool for speculators to exploit black families barred from access to traditional mortgages, have made a resurgence in Ohio since the foreclosure crisis.

Under these arrangements, buyers accrue zero equity in their home until the entire cost, plus interest, taxes, liens, and fees are paid in full.

Buyers who fail to keep up with payments can be removed from their home, forfeiting all investments they've made.

"Predatory land contracts sellers don't fulfill their obligation to the buyer. They may have a home in foreclosure while land contract buyers are making payments on the home," said Victoria Jackson of Policy Matters Ohio.

Jackson's report released Friday documents the exploitative nature of these contracts, their growing prevalence in Ohio and their concentration in the Mahoning Valley, one of the areas hardest hit by predatory home sellers.

Legislation to stop predatory land contracts was introduced by State Representative Michele Lepore Hagan last year and has had one hearing so far.

In Mahoning County, there are 1,600 recorded land contracts and Trumbull County has 2,700. 

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