LovelandPolitics.com Blog

In a follow-up to our story last year regarding a lease-with-option-to-own scam oeprating in Loveland a couple of important events occured recently. see story

The primary operator we reported on since 2009 has been arrested in Ft. Collins. Martin Hutcheson is an ex-con who operated the lease-with-option-to-own real estate scam in Northern Colorado now for a longtime but we don’t know yet whether the charges are related to his real estate activities. The case against Hutcheson is being prosecuted by the Colorado Attorney General’s Office

Hutcheson’s self-described former friend, Clayton Roberts, also probably regrets getting involved with Marty Hutcheson after a complaint by the mother of a victim against Roberts’ real estate broker license resulted in a $2,500 fine, public censure and mandatory additional training in property management, contracts and broker obligations by the Colorado Real Estate Commission.

Roberts recently posted a number of nasty comments about LovelandPolitics and its publisher on a December 1, 2011 blog posting. If you reference item 10 in Roberts’ disciplinary action, Roberts agreed, “No subsequent action shall be maintained or pursued by Respondent asserting the invalidity in any manner of this Stipulation and Final agency order.” Instead, he has acted in a retaliatory manner against anyone who cooperated with the investigation by attacking their credibility while also understating the findings to which he plead guilty.

Especially noteworthy is the Colorado Real Estate Commission finding that,

“Respondent admits that he/she has demonstrated unworthiness or incompetency to act as a real estate broker by conducting business in such a manner as to endanger the interest of the public.” And he is threatening LovelandPolitics with a lawsuit because we injured his sparkling reputation?

Once again a Loveland family has been fleeced of their life savings and even a place to live after being lured into Marty Hutcheson’s “lease with option to purchase” real estate scheme. see our special investigative report.

As reported in our story, Hutcheson is an ex-con with a long history of fraud, deceit and embezzlement. When his latest victims attempted to report their situation to the Loveland Police Department they were told it appeared more like a civil than criminal matter. In other words, no investigation.

Hutcheson and his accomplices carefully walk between state statutes involving landlord/tenant law and real estate transactions involving home purchases. The tenant is a “buyer” when anything needs to be repaired in the property and a “tenant” when the owner decides to evict them and keep their sizable “non-refundable” deposit. In other words, the tenant gets the responsibility and financial burden of home ownership but none of the rights or benefits – like equitable interest in the property and the improvements they make to it.

We call Marty Hutcheson’s real estate operation a “scam” because the tenants and “buyers” we interviewed say they were never told the who the real owner of the property was from the beginning. Had they known their contract was not with the owner they would have never signed. In addition, some owners claim they were also unaware of the terms but that may be by design. Most mortgage contracts now contain a “due on sale” clause that could be initiated by the lien holder (bank) if they discover the owner has potentially entered a land contract for the sale of the property.

Disclosure and transparency is everything in real estate. Taking people’s money and signing a lease with an option to purchase without the owner’s clear commitment and participation is a scam. The Arizona Attorney General has prosecuted real estate brokers in his state running a similar scheme by demonstrating they were violating consumer fraud statutes by misleading potential tenants into believing they could later buy a property when the real estate brokers knew better.

We don’t need any new laws but just an appetite by our District Attorney to investigate and prosecute bad actors in the real estate business to clean-up this mess.