According to the lawsuit, Beazer Mortgage advised prospective buyers to submit false information in their loan applications so they could qualify to purchase a home in a Beazer subdivision. In some cases, Beazer arranged for purchasers to qualify for larger loans than the purchasers could afford, which gave the company the opportunity to include the cost of financial incentives in the home price. However, because the loans were higher than purchasers could afford, many homes went into foreclosure.In addition to the lawsuit filed in North Carolina, a second lawsuit, also seeking class-action status, has been filed in South Carolina by a homeowner. The Securities and Exchange Commission has launched an informal investigation of Beazer to determine whether anyone at Beazer violated federal securities laws.
Meanwhile some homeowners say they were offered money in exchange for giving Beazer high marks in a customer satisfaction survey. One homeowner, Andre Gray, said he received an offer from Beazer for $100 if he gave Beazer a positive review. Three other Charlotte-area customers say Beazer made them the same offer. One of the homeowners who received a letter gave a copy to the Observer. The letter offers him $100 if he checks "Definitely Yes" when asked if he would recommend Beazer Homes to other people.
According to a report in the Charlotte Observer, Beazer executives were eligible for high bonuses if Beazer received high scores on the survey. That bonus could increase by five percent if 90 percent of customers in a division said they would recommend Beazer to someone else.
Although survey results from 2001 were positive for Beazer, chances are they would receive much lower marks now. The development Gray lives in has seen over one third of the original owners lose their homes to foreclosure.
If you purchased a home through Beazer and were pressured to lie on your loan application, or if you believe a Beazer representative gave false information on your application, contact a lawyer to discuss your options.