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twitterHomebuyers, union allege deception by builders
Thursday, Sept. 24, 2009 | 3:33 p.m.
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A group of 18 homebuyers and the Laborers International Union of North America charged Thursday in Las Vegas that Pulte Homes Corp. and other builders harmed buyers during the housing boom by inducing them into purchasing homes at inflated values and with unaffordable mortgages.
During a news conference organized by the union they asked the Nevada Attorney General's office to take action on complaints alleging deceptive sales and lending practices.
A union press release said Constance Consentino, one of the homebuyers filing complaints, purchased a Pulte home in Las Vegas in 2007 with a 20-percent down payment and a good credit score. The union alleged Pulte inflated the home price, used incentives to steer her to Pulte’s lending affiliate and failed to disclose important mortgage terms, particularly that their interest rate could increase after seven years.
A Pulte spokeswoman on Thursday said the company has not seen the specific claims so it is not in a position to respond to specific allegations.
"It appears this is just another staged effort that is part of a campaign orchestrated by unions trying to organize the homebuilding industry and specifically workers employed by several of our subcontractors. We believe this is part of a negative harassment campaign that seeks to target Pulte for publicity purposes and impact our good reputation. For several years now, these union groups have been involved in an ongoing harassment campaign against Pulte Homes. They stage events and make sweeping unfounded claims to try and establish distrust and get publicity," Pulte and Del Webb Communities spokeswoman Jacque Petroulakis in Scottsdale, Ariz., said in a statement.
In May, the union was involved in the filing of a lawsuit with similar allegations against KB Home and Countrywide Financial. That suit claimed they inflated home values and appraisals in Nevada and Arizona. KB Home and Bank of America, which now owns Countrywide, have denied the allegations.
Besides Pulte, Thursday's complaints involved Pulte's newly acquired Centex division as well as Lennar Corp and KB Home. The union has also been critical of lending associated with other homebuilders including D.R. Horton, Beazer, Ryland and Richmond American.
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in my opinion, how about personal accountability for reading documents before you sign them.
If she would have purchased a UNION BUILT home, she would have gotten a 1,200 sf home for about 400,000.00 Stop Bitching.. The unions are the downfall of America. Look at the auto business
Go Unions! Their job is to protect and defend their member's rights, and I think they do a great job at it. It is obvious that homebuilders blatantly ripped off their costumers within the last 5 years when we had our housing boom. The same houses are half the price now and mostly in foreclosure! Its nothing more than leading a mouse to a peice of cheese with a trap! Unions understand laws and are willing to fight for citizen's rights when we are defenseless.
devinmarie, so should house builders have sold their new houses for less than used house prices? how exactly did they rip people off? getting them drunk and blindfolding them to sign the papers? Yeah, I didn't think so.
Sounds like a whole bunch of attorneys are going to get very rich on this one. As for every one else involved, good luck.
At Nevadaappleslices,
Accountability?
Shut your trap, when will big business start to be accountable? If taxpayers can pony up the money for bail out loans then homeowners should have a bail out aswell. Your argument is foolish.
JSilver
Ridiculous! Homebuilders deceive new buyers... And when they're exposed, they blame the unions! It just shows who really cares about the consumers. (Hint: It's NOT the big builders.)
jsilver, were you dumb enough to sign a mortgage that you didn't understand? I wasn't. I read every page before I signed and educated myself like a responsible person signing for a loan. because people were lazy and ignorant to not do their homework, you think that taxpayers should bail them out? keep dreaming.
the unions aren't to blame. no one forced me, or anyone else, to purchase a home. the individuals that purchased the homes are to blame.
The big builders, the developers and the financiers have ripped off, bullied and bought the public for so long, we don't even realize we're being taken. Good for the unions for trying to balance the scale of justice!
The Unions shoud be brought up on charges under the RICO statutes. Union members are those who lack the intelligence to look after themselves. They deserve to be third class citizens because that is what they are.
I have to agree with jlb101 .. This method of unions attacking non union companies with all sorts of outrageous claims as a method of extorting a contract has to be criminal. It's not the goal that is wrong, but the method definitely has to be.
What I would like to know, are contracts being written up in other languages too. Sure, people will argue now that this is America and we should all know english... BUT REALITY is that knowing english is not the law and some costumers might not be able to read what they're signing. Some costumers trust the person's word selling the home to them, since this is supposed to be the great USA. THOSE people being snakes are to blame. Not the union for standing up to the homebuilders for unfair bussiness. Atleast when you use Union, You know you're getting quality work by certified people with the government backing them up.
The buying frenzy that was seen in our last real estate bubble has been seen many times before. First time Buyers are caught up in the momentum realizing that home prices are rising at an incredible rate.
The buyer witnesses the cost of a home 2-3 years ago was $150,000, during the height of the bubble that same house was going for $350,000-$400,000. The confused buyer somewhere in his/her confused brain is thinking that if he buys this house for $400,000 in three years it will be worth $600,000.
If the buyer has never experiencd a real estate bubble before, he has no idea what the market is doing, and of course the real estate agent isn't going to clue him in. The agent wants to sell at a maximum price so their percent profit is more. There is nothing like a sellers market, just before the bubble bursts.
BUT REALITY is that knowing english is not the law and some costumers might not be able to read what they're signing. Some costumers trust the person's word selling the home to them, since this is supposed to be the great USA. THOSE people being snakes are to blame.
You've got to be kidding!!!! If theyc couldn't READ what they were signing because it was in ENGLISH -- then get someone who could.
What a lame excuse "Oh gee - the contract I signed was in English - the OFFICIAL language of the United States. Let's sue because the contract wasn't provided to us in seven different languages"
Real Estate brokers knew that 27% of those that got sub-prime loans would fail, but they still conned them into signing and falsified the qualifications. Many who qualified for conventional loans were given sub-prime loans because the mortgage company/Banks would earn more interest. This is very similar to credit cards that offer a low teaser rate to induce the consumer and later jack up the rates. The appraisers were encouraged to appraise the value of the house higher. From 2000 into 2008 housing prices increased from 70-100% in the Las Vegas area, Southern California, the Phoenix area, and in Florida. These are the hardest hit areas in foreclosures. Now a lot of the foreclosures are the result of becoming unemployed and many of those foreclosures are conventional loans.
This ties back to Freddie and Fannie and when they were told to makes loans. They were told to lower their standards all in an effort to get more people into homes during Bill Clinton's presidency.
All of a sudden houses are selling like hot cakes, remember the lotto's to buy houses? It is not the builder fault that the market increased and then decreased. You should look to the government and their intervention.
Bottom line, Pulte is an outstanding builder that goes above and beyond for their homeowners.
This story is about the unions not having enough work for their members. Instead of trying to make mutual business arrangements they resort to the corporate campaign (tell you how bad you are and how much you need them, all the while publicly trying to tear your company apart). Pulte and its contractors have been enduring this for three years. I personally hope for the demise of unions like this. It's not 1930; there are plenty of laws and free help for any employee with problems at work, without having to pay a middle man dues plus three percent of your gross.
It's not 1930; there are plenty of laws and free help for any employee with problems at work, without having to pay a middle man dues plus three percent of your gross.
Exactly! In this day and age, the unions are no longer necessary. The unions certainly didn't help the GM and Chrysler employees who are now out of work, did they? I wouldn't be surprised if they helped destroy those two car makers. Unions in the past have ruined excellent companies because of prolonged strikes. Some never recovered from those strikes.