The U.S. Justice Department and the Consumer Financial Protection Bureau on Tuesday, Dec. 19, filed a lawsuit against Colony Ridge for alleged predatory lending practices. The suit accuses the company of bait-and-switch tactics in land sales, specifically targeting tens of thousands of Hispanic borrowers with false statements and predatory loans.
According to the lawsuit, Colony Ridge is selling unsuspecting families flood-prone land without water, sewer or electrical infrastructure, and setting up borrowers to fail with loans they cannot afford. Another claim in the suit is that Colony Ridge “exploits language barriers by conducting most of its marketing in Spanish while offering important transaction documents only in English,” said U.S. Attorney General Merrick B. Garland.
The lawsuit points to foreclosure rates in Colony Ridge — roughly one in four properties ends in foreclosure — after which the company repurchases the properties and sells them to new borrowers. The Justice Department and CFPB are seeking redress for borrowers harmed by Colony Ridge and an immediate end to its alleged illegal practices.
“Colony Ridge promised the American dream, but we allege that in reality, it has delivered a nightmare for thousands of hardworking Hispanic families who hoped to build their homes in the Terrenos Houston community,” said Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division. “This lawsuit demonstrates our commitment to holding accountable those in the housing and financial industry who intentionally target and exploit homebuyers because they are Hispanic or don’t speak English well.”
Trey Harris, along with his brother, John, are the developers behind Colony Ridge, a growing community currently home to 70,000 residents and located south of Plum Grove in northwest Liberty County. Trey Harris called the lawsuit “total bullshit” and says that claims made in the suit are completely false.
“I don’t understand why we are being made into the bad guys. There are thousands of people who were living in apartments and rent houses who now have their own houses and are earning equity,” he said. “If they are paying a slightly higher interest rate, it is still better than paying rent and not earning any equity.”
Harris dispelled the notion that a 12.9 percent interest rate is predatory, as the Justice Department claims.
“This is not a variable interest rate that is impacted by the market. We are stuck with this interest rate for 20 years. If you are trying to keep track of your budget and are a consumer, and you have a loan with a variable interest rate and it goes up suddenly, then your payment will go up suddenly and your budget will get whacked. For us, even if the interest rate changes, the payment amount stays the same,” he said.
As for the claims that buyers are being sold lots with claims of water, sewer and infrastructure already in place, Harris said the U.S. Justice Department is misinformed. Water and sewer systems are installed throughout the development; however, the buyer might have to work with plumbers and third-party water and sewer service providers to get their homes connected and have their services started. As this is a rapid-growth development, it takes time for power utility providers – Sam Houston Electric and Entergy – to connect service, but he says this also happens in a timely manner.
The suit alleges that Colony Ridge employees are failing to disclose that properties have repeatedly flooded in the past or have never flooded and that heavy flooding causes raw sewage to run through or around borrowers’ properties.
“Again, this is complete and total bullshit. We don’t sell any lots that are in the 100-year flood plain. Some of the lots we sold in the past might be 1,000-feet deep with the back portion in the flood plain, but the buyers are told this. They are also told they might have to build up a portion of their lot, but we aren’t selling properties in the 100-year flood plain,” Harris claims.
As water and sewer services in the state are regulated by the Texas Commission on Environmental Quality, Harris said there is documented evidence to show enforcement actions have been resolved as they have arisen. Colony Ridge Development LLC has a “satisfactory” classification and Colony Ridge Land LLC has an “unclassified” classification on TCEQ’s website.
Bluebonnet News has submitted a request for information to TCEQ regarding the exact number of enforcement actions taken against Colony Ridge over the last decade. (The information is not available at the time this story was posted. An update will be made as soon as this information becomes available.)
“There was a situation where one time in the past an electric company drilled a hole for a power pole through our sewer line. It was stopped within an hour. A vacuum truck company came out and sucked up the sewer water that leaked out and we minimized the problem as best we could. The line was shut off on both sides, repaired and then opened back up,” he said.
With more than 500 miles each of road, water and sewer lines running through the Colony Ridge communities, there is always a chance that a contractor can cause a mishap, Harris said.
Addressing both claims in the suit of high foreclosure rates and high interest rates in Colony Ridge, Harris said the Justice Department is comparing apples to oranges.
“We are making land loans to people without any money down and with no credit. This is not a mortgage loan; it is a land loan. There are a lot of banks today that won’t even do land loans without equity, and none without credit checks and a down payment. We are giving people an option to develop a credit history,” Harris said.
In the suit, the Justice Department cites, “When families fall behind on payments and enter foreclosure, it allows Colony Ridge to ‘flip’ the properties by repurchasing and reselling them, often at higher prices. Foreclosure and property deed records show that Colony Ridge flipped at least 40 percent of all the properties it sold between September 2019 and September 2022, selling approximately 8,237 properties twice, 3,267 properties three times, and 2,067 properties four or more times in three years.”
Foreclosure records cited in the lawsuit reportedly confirm that “Colony Ridge accounted for more than 92 percent of all foreclosures recorded in Liberty County between 2017 and 2022, and Colony Ridge shows no sign of slowing down: Between January 2022 and June 2023, Colony Ridge’s lending arm initiated an average of 298 foreclosures in Liberty County monthly. From 2021 to 2022, Liberty County had more foreclosures (6,495) than Dallas County (4,038), or Bexar County (5,016), even though Liberty County’s population is approximately 5 percent of those counties. And, even though neighboring Harris County’s population is 51 times larger than Liberty County’s population, the latter counted almost half as many foreclosures as Harris County (14,089) during the same period.”
Harris defended the foreclosure practice comparing it to a car loan lender repossessing a vehicle once payments stopped being made.
“If you stop making your payments on your vehicle, what does your car loan lender do? They repossess it and sell your vehicle to someone else,” he said. “That’s what we do.”
To see the entire complaint in the lawsuit, go online to https://www.justice.gov/d9/2023-12/colony_ridge_complaint.pdf
Anyone who believes they have been harmed by the practices of Colony Ridge Development LLC, Colony Ridge BV LLC, Colony Ridge Land LLC, and Loan Originator Services LLC should call the Justice Department’s Housing Discrimination Hotline at 1-833-591-0291, press 1 for English, then 3 for fair lending, and then 1 for Colony Ridge Lawsuit to leave a message. For the Spanish Hotline, callers should press 2 for Spanish, then 3 for fair lending, and then 1 for Colony Ridge Lawsuit to leave a message. Individuals can also send an email to ColonyRidge.Lawsuit@usdoj.gov.
To see the full press release from the Justice Department, go online to: https://www.justice.gov/opa/pr/justice-department-and-consumer-financial-protection-bureau-sue-texas-based-developer-and
Well it’s about time.
Good. Shut down Trey Harris’s underground railroad for illegals, then ship all these uncivilized taco benders back, so our community members can sleep without nightclub levels of music in our living rooms and we don’t have to worry about our daughters getting sexually assaulted walking to their friends’ houses.
The days of Liberty and Montgomery counties being like Norman Rockwell paintings have been gone for over a decade.
EVERYONE has been saying this has been happening for years but we were all called liars, shit starters and jealous. Yeah about time. Shut that damn trouble crime ridden community down.
Yep, Chance is right. We’re all just racist Trumpers that don’t like Hispanics. Reality is crime has spilled out from this area for years. I’ve been a victim of it personally, as well as many neighbors. We don’t even live near Plum Grove, but something has made this whole area lucrative to people who gravitate toward crime, and I’d say Colony Ridge is the nucleus of the problem. Now we have to worry about getting assaulted while out in our community… most of the petty crime doesn’t even get reported, because it takes an act of God to get the Sheriff out.
There needs to be an immigration checkpoint set up, too. If they can do it 100 miles inland from the border, they can do it here.
Flush this toilet for good.
I would like to know how many of these people are actually legal citizens of the U.S. and how many are illegal. Will we ever know? Probably not. He deserves what he gets. He is a magnet for these people and they think all is well. He destroyed a nice little country community and caused good folks to move away from the dangers of that community. I have no sympathy for Mr. Harris, nor the people he has taken advantage of.
There are a large number of illegals in his developments, plus the area in general. There may be one person who is a citizen by birthright citizenship who has all the property in their name, but then their family comes here illegally and lands there in their little hideout. I have personally talked to several members of King’s Colony, and they verified there are a very large percentage of illegals.
And Harris didn’t just destroy a community- he destroyed a three county area that used to be very desirable.
That sounds about right to me. Notice that almost every time there is another murder associated with or committed in Colony Ridge subdivisions, not only are the suspects found to have been in the country illegally BUT SO ARE THE VICTIMS! That is just crazy if you ask me, and reason to be angry about this whole mess.
Harris said it’s not in a 100 year flood plain. Maybe not but nearly everyone around Liberty and surrounding Counties has logged these woods. They know when it rains a lot it floods. Maybe the Lawsuit will make him buy the land back and stop selling it.
I love hearing Trey Harris cry in this article. He should be so lucky to only have to file bankruptcy and slink off with his tail between his legs. He should be hung from a tree for what he’s done to his State and surrounding counties. Liberty County will never be the same. Only good thing to come of this is similar developers with the same idea will not even think about pulling something like this once the Feds sink their teeth into them.
Trey Harris and all of his puppet politician friends need to be investigated. To think that our “leaders” in Liberty County have been getting kick backs from him this entire time is sickening. They all should go to prison for the chaos they have created!
Sentence them to a life of having to live in between some of Trey Harris’s “hard working families” like I have had to do for the last 10 years.
Every politician in Liberty County needs to be voted out in the Republican Primary in March of 2024
Yes but no one will run against them and if they do the good ol buddy system gets them reelected.They shut down voting boxes that votes against them too.
A friend told me that he had a case in liberty county, and the lawyer told him that he hated going to liberty county because it was like going back in time to judge Roy beans court.
Janis Holt is running against Bailes.
And so is Steven Missick. Frankly Bailes and Nichols both gotta go no matter what. Liberty County needs to be investigated for it’s refusal to enforce it’s own Rules for New Subdivision Development where Colony Ridge and the Harris Brothers are concerned… something stinks in Jay Knight’s court!
So on the sewage thing, Camino Real overflowed some 48,000 gallons of raw sewage down Maple Branch thru my back yard and all the way to behind the city hall building one weekend in 2019 I think it was. My photograph of dead perch laying next to black water in the branch behind my yard has made many a new article to date, but has never been credited to me. I also took photos of sewage in the storm ditches in Camino Real at Omega Street a few years back with pvc pipes and fluorescent green algae…. also used in a lot of news articles but never attributed to me. And finally I documented the Francis Street upwelling of sewer water that was flowing down a storm ditch into Luce Bayou where it was gathered in large pools, also popular pics I took that I never get credited for. But oh well, I took them the originals are still on my cell phone. These are just a few of the sewer leaks that I have seen occurring out in the Colony Ridge subdivisions, and all that sewage ends up in the East Fork where it then flows down to Lake Houston which is the drinking water supply for Harris County and Houston! Yuk! Problem is, all that contaminated water 1st flows thru the City of Plum Grove neighborhoods and that ain’t right… City of Houston may be ok with that mess, but we are not! smh!
[…] brothers have blatantly refute all of the federal allegations, telling a local news outlet that the lawsuit was” total bullshit,” making all of them completely […]