Lubbock business accused of misleading practices - KCBD NewsChannel 11 Lubbock

9/14/09

NewsChannel 11 Investigates: Lubbock business accused of misleading practices

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By Nicole Pesecky - bio | email

LUBBOCK, TX (KCBD) - A local business is accused of deceptive and misleading practices affecting those across the state. And now a Texas representative is taking notice. NewsChannel 11's investigator Nicole Pesecky has been digging up details for weeks.

Letters from Texas State Representative Mark Homer are addressed to the Texas Attorney General, and to the president of Enhance Mortgage Corporation, Mark Brown. They both say the company is engaging in deceptive and misleading practices, and two different clients of Enhance Mortgage are claiming that exact same thing.

Joseph Hayes of Mount Pleasant, and Nathaniel Rido, the CEO of Southeast Keller of Houston, have two things in common, they both did business with Enhance Mortgage and are both being sued by that Lubbock company. Enhance Mortgage is a Texas corporation that buys owner held notes, they do business with thousands throughout the state.

Two clients who signed contracts with Enhance feel like they've been taken for a ride. "I realized this company wasn't being ethical in their business trades. I don't think anybody would have signed the contract with their interpretation," Hayes explains. Rido agrees stating, "They're taking people's properties for little of nothing and using the law to hide behind it."

Now Texas State Representative Mark Homer is taking note. He issued a statement to NewsChannel 11 which states, "Anytime time I am contacted by a constituent who seems to have been victimized by a company that appears to be using deceptive practices to prey on innocent Texans I am going to use the resources of my office to get to the bottom of it. This company is seemingly using the Texas court system as a way to make a profit by making it too expensive for their clients to defend themselves against their questionable business practices."

When asked what they would say to clients who signed their contracts with one value, which is later appraised at a lower value, and then offer even less than that, attorney Jerry Corbin said, "They give us the information and in this case they gave us the wrong information." 

Corbin says his client Enhance Mortgage received false initial information from Hayes, claiming his property was worth $76,000. Corbin says, "That is incorrect due to the fact we have an appraisal which comes back at 35,000." That's when Hayes pulls out of the agreement and that's when he's slapped with a lawsuit. "The contract says if there is something incorrect about what he tells us we can take a pro rata offer," Corbin explains.

Rido says Enhance is abusing the legal system, "I think it's unfair and I think there's a lot of senior citizens and people being misused by the system."  

We went down to the Lubbock County Courthouse to see just how many lawsuits Enhance Mortgage filed. We found more than 90 lawsuits since 2002, many of them claiming breach of contract. The company claims they have more than 30,000 clients throughout the state of Texas, so 90 lawsuits is not a large amount.

We also checked with the Better Business Bureau to see if they had received complaints. They gave Enhance Mortgage an A+ rating.     

Corbin says they don't use the same appraisal company for every client, "They send out an appraiser - we don't know who it is. We have no control over them." The contract is signed before an appraisal is done, and Enhance Mortgage never even sees the property it's buying.

It's up to the courts to decide if Enhance has violated any laws. We'll follow this story and bring you any developments. 

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