On May 14, 2024, the Minnesota Attorney General announced that it had filed a lawsuit against a realtor and several companies that he owns, claiming that they used deceptive trade practices to market illegal contracts for deed, in violation of several state and federal laws, including the Truth in Lending Act (TILA), Minn. Stat. § 513.55, and Minn. Stat. § 559.202, both of which include required disclosures that must be included in residential property sales.
The Attorney General’s complaint alleges that the companies would utilize contracts for deed, in which the buyer would pay the seller over a period of time rather than all at once, but specifically targeted purchasers who could not or would not obtain a mortgage due to financial difficulties or religious beliefs and utilized unfair terms such as requiring large down payments, balloon payments, or higher-than market interest rates. The lawsuit also alleges that the Defendants misrepresented or hid material contract terms, and offered discriminatory contracts to Muslim purchasers by offering higher sales prices, higher down payments, and higher monthly payments than contracts marketed to non-Muslim purchasers.
The lawsuit requests the court enjoin the defendants from continuing the alleged unlawful behavior, impose civil penalties, and to either cancel or reform existing contracts.