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Related: Editorials & Other Articles, Issue Forums, Alliance Forums, Region ForumsWarren Buffett's mobile home empire preys on the poor
Billionaire profits at every step, from building to selling to high cost lending
Buffetts mobile home empire promises low-income Americans the dream of homeownership. But Clayton relies on predatory sales practices, exorbitant fees, and interest rates that can exceed 15 percent, trapping many buyers in loans they cant afford and in homes that are almost impossible to sell or refinance, an investigation by The Center for Public Integrity and The Seattle Times has found.
Berkshire Hathaway, the investment conglomerate Buffett leads, bought Clayton in 2003 and spent billions building it into the mobile home industrys biggest manufacturer and lender. Today, Clayton is a many-headed hydra with companies operating under at least 18 names, constructing nearly half of the industrys new homes and selling them through its own retailers. It finances more mobile home purchases than any other lender by a factor of six. It also sells property insurance on them and repossesses them when borrowers fail to pay.
Berkshire extracts value at every stage of the process. Clayton even builds the homes with materials such as paint and carpeting supplied by other Berkshire subsidiaries. And Clayton borrows from Berkshire to make mobile home loans, paying up to an extra percentage point on top of Berkshires borrowing costs, money that flows directly from borrowers pockets.
More than a dozen Clayton customers described a consistent array of deceptive practices that locked them into ruinous deals: loan terms that changed abruptly after they paid deposits or prepared land for their new homes; surprise fees tacked on to loans; and pressure to take on excessive payments based on false promises that they could later refinance.
http://www.publicintegrity.org/2015/04/03/17024/warren-buffetts-mobile-home-empire-preys-poor
merrily
(45,251 posts)delrem
(9,688 posts)But billionaires don't really walk among us as equals.
merrily
(45,251 posts)delrem
(9,688 posts)merrily
(45,251 posts)better than no sense at all.
delrem
(9,688 posts)merrily
(45,251 posts)delrem
(9,688 posts)How about if Buffett set up a Buffett Family Foundation to take in charity donations from his friends, to be spent on making and selling the Buffett mobile home package, to the needy, at no-bid prices because this is a Gov't project?
merrily
(45,251 posts)IIRC, he didn't even pay college tuition for his grandkids.
delrem
(9,688 posts)You win. The reality dealt by these fuckheads trumps hyperbole/sarcasm every time.
I guess I'd better start thinking about ways to take that into account.
delrem
(9,688 posts)LittleBlue
(10,362 posts)Who supports Hillary and finds Warren too angry. Hmmmmmm