Wisconsin Bans Major Rent-to-Own Operator
October 17, 2017
Vision Property Management, one of the nation’s largest operators of rent-to-own homes, has been banned from operating in the state of Wisconsin. The state’s court has issued a temporary injunction against the firm while a legal battle continues on over the quality of homes that the company is renting to tenants.
Read more: Lawmakers Target Seller-Financed Homes
The Wisconsin Department of Justice sued Vision Property Management and its affiliates in June, accusing the firm of using “misleading and deceiving business practices to induce Wisconsin customers to lease, rent, or purchase uninhabitable properties.” The state’s DOJ says it is in violation of its landlord-tenant and mortgage banking laws.
VPM has been accused of trying to get consumers to lease “uninhabitable” homes by offering them an incentive to be able to buy the house in the future. The lawsuit claimed that VPM requires tenants to pay for the costs to rehabilitate the property, pay all overdue taxes, and resolve any outstanding building code violations with the property, HousingWire reports. If the tenant fails to do so, VPM evicts the tenant and finds another one.
The court order prohibits the company from entering into new lease-to-own contracts in the state. It also will be unable to evict tenants during the injunction. VPM tenants also are able to terminate their leases without penalty and can seek financial damages.
VPM operates nearly 200 properties in the state. It owns more than 5,500 homes nationwide and has faced lawsuits in other states too.
The lawsuit comes at a time when rent-to-own leases across the country are coming under increased scrutiny. A recent investigation by The New York Times called into question some rent-to-own agreements that they called risky and lacking in consumer protections. The Consumer Financial Protection Bureau is investigating some larger investors using seller financing in real estate deals, and lawmakers in states like Ohio, Michigan, and Illinois are targeting abusive seller-financing deals with new legislation aimed at better protecting buyers in these contracts.
Source: “Rent-to-Own Operator Vision Property Management Shut Down in Wisconsin,” HousingWire (Oct. 11, 2017)
Updated: July 20, 2018