Land Contract Fraud Alert: Detroit Landowner Accused Of Fraud

Land Contract Fraud Alert: Detroit’s Biggest Landowner Michael G. Kelly Accused Of Land Contract Fraud


land contract fraud
Most Detroiters have never heard of Michael G. Kelly. Yet, Kelly is one of Detroit’s biggest landowners. Kelly is now being accused of land contract fraud. Plaintiffs allege the contracts are fraudulent and predatory. However, the term predatory doesn’t always apply to land contracts as it does with mortgage lending. This lawsuit would change that. 
Mantese Honigman and Michigan Legal Services filed the suit. The lawsuit seeks class-action status and alleges that Kelly and four other defendants lured vulnerable Detroiters into a “real estate bait and switch.” 
The lawsuit alleges Kelly and others violated the Truth in Lending Act and the Home Ownership Equity Protection Act. However, land contracts operate outside government regulations. The lawsuit argues that Kelly’s land contracts violate the spirit of TILA and HOEPA. Additionally, Michigan courts have upheld that land contracts and lease options are equitable mortgages. 

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