Village officials believe the operators of North Branch Meadows may be in violation of the consent judgment that governs it. Photo by PATRICK McABEE

Village council was recently informed North Branch Meadows is in some cases occupying homes with individuals and families who are moving in on a rent-to-own basis. Officials said at last Thursday's council meeting, according to a court-mandated consent judgment between the village and Beacon Hill Properties, no renting of homes is supposed to occur. Operators, meanwhile, say the issue is one of legal semantics and those who have moved in under rent-to-own terms do eventually take title to their homes.

In the consent judgment, operators are prohibited from using "creative financing" to fill the lots and homes with buyers, officials added. All homes in the park are supposed to be owner-occupied under the agreement between the village and the park.

North Branch Meadows management is also supposed to inform village officials when occupants of the homes move out or in. The purpose is so the village can keep accurate track of utility use by residents at the park. Proof of ownership of a home is required before water service will be turned on to that residence by the village.

The park's home rental issue was discussed at the April 5 village council meeting.

"First we have to identify them," village council President Kelly Martin said at the meeting of those who are renting homes within the park.

"I suspect by Monday we'll be looking into it. We do have recourse."

Todd Wyatt, representing Beacon Hill,told The County Press Monday his company is providing a service to those who cannot afford the down payments on their homes.

"What we are doing is a few people who have wished to move into the community don't have a big down payment to put down. Typically it takes about $3,000 as a down payment. It is a total of $4,000 to $5,000 to move in. What have done is allow them to move into the home without this. We had to give them some sort of legal term, so they became a rent to own owner. At end of 12th month, that is when the title transfers," Wyatt said.

In doing so, the company is providing opportunities for those who have lost their homes, he added.

"It's been great for people who have lost homes in scams in one- and three-year arms. Several of those people have appeared on our door step and are thrilled someone is willing to give them a second chance. They were just taken to the cleaners by a lender," he said.

"We saw it as a real win/win situation."

The company uses similar agreements at its other properties, in Pontiac and the northern Michigan community of Cheboygen.

Wyatt added Beacon Hill, whose North Branch mobile homes are marketed by Little Valley Homes, initially approached village attorneys about the rent-to-own concept last summer. He stated the company was told it would have to establish a legal definition that fit the consent judgment. In creating rent-to-own owners, it thought it had done so and erroneously assumed it did not have to go back before council.

Wyatt added documents would be filed with the village this week.

A resolution may not be that simple, however, Martin stated.

"The underlying problem is that the understanding I have is its almost impossible to get a bank or mortgage company to finance on rented land. I told him if he could stay within parameters of consent judgment that we'd be happy to take a look at proposal," Martin said Monday of a discussion he had with Wyatt after last Thursday's meeting.

At this point, the village is in a wait-and-see mode.

"It raised a real concern," Martin said. "On its face it (rent-to-own) appears in violation of the consent judgment. We haven't had the benefit of seeing if what they're doing violates the consent judgment," he said.

Last Thursday, the idea of turning the water to the offending units off was raised during discussion by council members and residents.

However, Council Member Leonard Cowles stated individual shut off valves were not installed. Either the water would have to be shut off to the entire park or on a block-by-block basis.

Council members were also concerned plans may be placed into motion this spring by the park management to install new units and fill any unoccupied homes with rent-to-own tenants.

Village officials expects to address the issue at an upcoming session. The council's next session is slated for Thursday, May 3 at 7 p.m.

Editor Jeff Payne contributed to this report. He can be reached at (810) 664-0811, Ext. 8106 or jeff.payne@lapeergroup.com.