RALEIGH, N.C. (WECT) - The N.C. Attorney General’s Office and a real estate business that operates in the eastern part of the state have reached a settlement to resolve a lawsuit over alleged home-buying schemes.
The judgement requires J.S. Enterprises of Swansboro LLC and James Morris Stallings III to pay $110,00 to eligible affected consumers and $10,000 to the state.
J.S. Enterprises primarily operates in Onslow, Pender and the surrounding counties.
The estimated 80 to 120 eligible consumers will receive written notice from the Attorney General’s Office with more information and claim forms.
“These defendants broke the law and caused real financial harm to homeowners and tenants,” said Attorney General Josh Stein. “I’m pleased that those impacted will get the relief they need. My office will hold accountable businesses and individuals when they don’t treat consumers fairly.”
Stein filed a lawsuit against Stallings and J.S. Enterprises in April 2019.
“His lawsuit alleged that the defendants bought properties from distressed homeowners with promises to deliver cash in hand or pay all closing costs, amongst other false advertising,” a news release from the Attorney General states. "In reality, the defendants gave these homeowners promissory notes with small monthly payments and zero percent interest over a long period instead of the cash at the time of sale. In other instances, the defendants acquired consumers' homes without paying off their existing mortgages, and without making consumers aware that they would remain obligated to pay the underlying mortgages.
“Once they bought the properties, the defendants then leased them to consumers in financial hardship or with poor credit histories using lease agreements that violated North Carolina’s landlord-tenant law. These agreements led consumers to believe that they would ultimately own the home and asked them to make and pay for repairs to the properties they were leasing.”
As part of the settlement, the company is required to sell or refinance properties so that consumers who sold their homes can be repaid in full.