St. Louis, Mo., June 9, 2011 – A St. Louis area real estate investor who buys and “flips” financially troubled property is facing angry criticism from consumers who say he cost them thousands of dollars or severely damaged their credit when home deals went sour.
The Better Business Bureau (BBB) recommends extreme caution when dealing with Jack L. Roddy, JMZ Homes, JMZ Investment Group or Bagwell Group Management Corp. Roddy has an office in New Athens, Ill., but also lists an address in St. Charles, Mo.
A sergeant in the Missouri National Guard who is scheduled to deploy overseas in the next several weeks said Roddy cost his family more than $15,000 and nearly ruined his life when Roddy stopped making mortgage payments on the man’s home in O’Fallon, Mo., and the house slipped toward foreclosure. The guardsman’s wife said the stress “sent me over the edge. I thought we were going to be put out on the street.”
Another consumer, also from O’Fallon, said she stands to lose an $11,000 down payment after a home she was buying from Roddy recently went into foreclosure.
Michelle L. Corey, BBB president and CEO, called the stories from home buyers and home sellers who have dealt with Roddy heart-wrenching. “In many cases, these are people who believed they were making sound investment decisions, only to find their lives turned inside out. It is a real shame.”
Roddy, who said he has been in the real estate business between 15 and 20 years, describes himself on his LinkedIn listing as a multi-millionaire, marketing director of JMZ Investment Corp., CEO of Bagwell Group and a platinum member of the Global Information Network. The listing describes the Global Information Network as “a private, exclusive, members-only global association of individuals dedicated to achieving financial independence, wealth creation, dynamic health and emotional well-being.”
In an interview with the BBB from his New Athens office, Roddy blamed his mounting problems on uneducated investors, naïve home sellers and “deadbeats” who stop making home payments. “I’m tired of babysitting all these deadbeats who don’t pay,” Roddy said.
Other consumers who claim to have had problems with Roddy include:
- Another woman from O’Fallon who says Roddy talked her into transferring ownership of her late father’s home to a trust controlled by JMZ Homes. A lawsuit pending in St. Charles County claims that Roddy and JMZ breached the terms of a contract by refusing to pay the woman $35,000, and failed to pay the debt on the property, “causing the real estate to be subjected to foreclosure procedures.”
- A businesswoman from Arizona who said that a deal with Roddy “took me right to brink of bankruptcy.” The businesswoman told the BBB she met Roddy at a real estate seminar in Florida. She agreed to invest in a small “fix and flip” house in Pana, Ill. She said she lost more than $33,000 in the purchase and in an unrelated loan to Roddy. She also said that a family that was involved in a lease-purchase agreement of the home lost $7,000 when water problems made the house uninhabitable.
- A couple who entered into a lease-purchase agreement at the same O’Fallon address where the Army sergeant and his family had once lived. The couple said they had given Roddy a $12,000 down payment on the house and had put an additional $10,000 of renovation work into the structure earlier this year. Just last week, that family learned that Roddy had missed several mortgage payments on the home and, once again, it was at risk for foreclosure. “I want to make sure this guy is never able to do anything like this to anybody ever again,” said the husband, who first learned the house was facing foreclosure from a BBB investigator.
Roddy said he ran into financial trouble with the lease-to-purchase homes only after the buyer stopped making payments to him. But home buyers told the BBB that is not true. They said they stopped making payments to Roddy only when they learned that Roddy had stopped paying the lenders and the homes were threatened with foreclosure. The national guardsman said he couldn’t justify continuing to invest in a house that he might soon lose to foreclosure.
Two other families – one who transferred ownership of a home directly to Roddy and another who transferred a home to another business that later transferred it to Roddy – said that their credit was damaged when Roddy got behind on mortgages they still held.
Roddy said he could not tell a BBB investigator how many properties he owns and how many are currently in lease-to-buy agreements.
He said he intends to get out of the lease-to-buy business in the near future, but insists he has done nothing wrong. “I didn’t know there were that many people who did not pay their bills,” he said.
Recently, Bagwell group began posting signs reading “Storm Repair Keep Your Deductible” in neighborhoods where homes were damaged in recent storms.
The BBB offers the following tips to prospective home owners looking at a lease-to-buy option:
- Determine whether the seller owns the property outright or is making mortgage payments to a lender.
- Beware of deals where the mortgage is not in the name of the seller, but in the name of a third party. If the seller of the property does not own the home outright and somebody else is making payments to a lender, the owner may have nothing to lose by letting the property go into foreclosure.
- Get references. Contact others who have dealt with the business to determine whether you want to get involved.
- Contact the BBB for a BBB Business Review by going to www.bbb.org or by calling 314-645-3300.
Contacts: Michelle Corey, President & CEO, 314-645-3300, firstname.lastname@example.org, or Bill Smith, Trade Practice Investigator, 314-645-3300, email@example.com