The world of realty to buy or rent

A Henderson man and his three mobile home sales businesses agreed on May 25 to a consent judgment under which he will reimburse the state and his customers and abide by fair trade practices.

With the judgment, Donald Gupton, Dynasty Homes, Creative Real Estate and Superior Housing Center resolved a nearly two-year-old lawsuit filed by Attorney General Roy Cooper in Wake County Superior Court. The agreement was linked to a separate, confidential settlement of a private lawsuit filed by about 65 would-be customers.

"Consumers thought they were getting homes they could afford but instead got tricked into payments they couldn't keep up with," Cooper said in a press release. "People lost their homes and their hard-earned money, and banks lost on bad loans."

Gupton apparently faxed a statement to the Daily Dispatch that read, in part: "I never intended to hurt anyone through my business, and I deeply regret any problems that may have been caused."

The statement, which was written in the first-person voice but did not bear the name or signature of an individual, was sent on Creative Real Estate and Manufactured Housing Sales Center stationery. It noted that Gupton was pleased that the lawsuits were resolved.

"I remain in business and want to continue to work in my home community," the statement also said.

Under the settlement, Gupton will pay $75,000 to the state and "substantially more money," in the words of Cooper's press release, to more than 60 victims represented by a private attorney. The settlement with the would-be home buyers is confidential, but the release said Cooper stipulated that consumers get money from Gupton and his businesses.

Gupton and his companies must allow the state attorney general to review its loan files and sales records at any time to ensure compliance with the law.

The attorney general's announcement of the settlement was released Thursday afternoon. Calls placed that evening to various parties involved in the dispute were not returned, aside from a statement faxed by Gupton.

Cooper's office first began investigating Gupton's practices in 2002 following complaints from consumers, according to Noelle Talley, public information officer for the N.C. Department of Justice.

"As alleged in the lawsuit filed in January 2003, consumers were lured by advertisements that promised to help those with 'bad credit' get a home for $500 a month," Talley said.

The attorney general's office noted that many consumers wound up losing their homes through foreclosure or were forced into bankruptcy.

"The complaint also alleged that Gupton inflated sale prices and property values, causing financial loss to banks that funded the loans," Talley said.

In a sworn affidavit from an investigator for the North Carolina Real Estate Commission in January 2003, the numerous complaints against Gupton and his businesses were detailed for presentation by the attorney general to Wake County Superior Court.

In his statement, Gary Caddell said the first complaints to the commission about Gupton's business were received in October 2000 and January 2001.

An anonymous complaint received in June 2001 alleged that the firm was using unlicensed salesmen to sell real estate, that its employees were creating false down payments and falsifying other documents in order to obtain financing for customers.

In May 2002, an anonymous complaint was filed by someone who identified himself as a "A Concerned Licensed Vance County Realtor." The complaint alleged that some of Gupton's employees were selling real estate without a license.

Additionally, Caddell said in the affidavit, the complaint contained numerous articles that had been written in the preceding months by Barbara Arnsten, a staff writer for The Daily Dispatch.

"Arntsen had written several stories about fraudulent loan practices and the unusually high default rate for homes sold by Creative Real Estate," Caddell said. The May 2002 complaint was combined with the June 2001 complaint, he said, and referred to him for a field investigation.

Caddell said he began his field investigation in June 2002 by contacting the consumers who were mentioned in the newspaper articles.

The attorney general said that his office "is firmly committed to looking out for homeowners and other consumers." "Buying a home is the most important purchase many people will ever make," Cooper said.

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