Your outrage level will go to 11.
Unscrupulous investors use a Jim Crow-era law still on the books to strip distressed property owners of their life’s savings and family inheritances. Nonprofit reporting by Asheville Watchdog, a distinguished group of not-so-retired journalists (some Pulitzer-winners), has exposed how real estate investors use partition or forced sales, a practice banned in 19 states (but not North Carolina), to relieve poor property owners of land and homes that may have been in their families for generations.
Sally Kestin, winner of a 2013 Pulitzer Prize for Public Service, writes:
Many were elderly or Black homeowners in distress. Some were vulnerable to a Reconstruction-era property law abused so often that it has been rewritten in other states, but not North Carolina.
And most were left embittered or poorer by their encounters with Buncombe County real estate investor Robert Perry Tucker II, who acquired their houses and lands at far below market rates, a year-long Asheville Watchdog investigation found.
In a review of more than four dozen of Tucker’s real estate transactions since 2014, Asheville Watchdog found his companies have acquired interests in Buncombe properties for as little as $250 — or nothing at all. Many of the sales appear to have generated profits for Tucker while erasing years if not generations of home equity for property owners, nearly half of them Black.
Fewer than eight percent of county resident are Black or African American.
Part 1 of Kestin’s investigation describes the players involved and the schemes used to prey on people hard-pressed to pay property taxes or who fall behind on mortgage payments. In one case, “The family of George G. Wilson Jr., now deceased, wonders how he could have made the full, cursive signature on a notarized deed selling his share of the family house to a Tucker company when he didn’t have fingers.”
Tucker’s attorney insists, “Nothing that has been done has been illegal. Nobody has been coerced in any way, shape or form. These were all voluntary transactions.”
They are “taking advantage of people who don’t have the life experience and background to protect themselves,” said Molly Maynard, director of the consumer law program at Pisgah Legal Services, a local nonprofit providing “free civil legal aid to people who live in poverty.”
Part 2 of the Asheville Watchdog report describes how a Jim Crow-era law allows the attorney and his associates to force sales of properties after acquiring partial interest in them from family members:
Five hundred dollars was all it took for Robert Perry Tucker II to gain an interest in an Asheville home that had been owned by a Black family since 1918.
Two elderly heirs signed deeds selling their shares of the home to a Tucker company for $250 apiece. With their ownership in hand, Tucker’s company used a Reconstruction-era law to force a sale of the entire property, and another Tucker company bought it at auction for $3,750.
The eight heirs whose family had owned the property for a century received $445 each, the auction commissioner reported. The Tucker company that bought the property sold it in three months for $55,000.
Part 3 explains how investors exploit partition sales to
Courts often order partition sales by public auction, and the way they’re advertised and conducted virtually guarantees a below-market price, according to research by Thomas Mitchell, a law professor at Texas A&M University and principal author of the Uniform Partition of Heirs Property Act, a proposed law for states to help prevent abuses.
Family members who want to keep a property have limited options. Banks typically decline to accept fractional interests in properties as collateral for loans. Many heirs are cash poor, and as Mitchell puts it, unable “to outbid even a low-ball bidder.”
Advertising of the auctions typically consists of a legal description of the property in a newspaper — the weekly Weaverville Tribune for D’Ascanio’s land. Many potential bidders do not participate in partition auctions, Mitchell found, because they “never find out about such sales in the first place.”
Some states set a minimum price that must be met. Not North Carolina.
“I would liken it to a scam … If this is legal, it shouldn’t be,” Rep. Brian Turner, a Buncombe County Democrat told Asheville Watchdog. He is behind an effort to ban the practice in the next legislative session:
“For far too long unscrupulous people have been using the partition sales process to cheat people out of the full value of their property,” Turner said. “This has had devastating consequences for too many families in WNC who have seen multi-generational properties, homes, and farms sold for pennies on the dollar.”
This is perhaps the most stunning reporting I’ve seen since the 2018 Times’ special investigation of Fred Trump and the Trump Organization. It is another reason why readers need to be more involved in local politics. This is not something that gets fixed at the federal level.