Friday, November 6, 2009

Trouble in Cowee

Another luxury development in the mountains is making headlines.

In the November 4, 2009 issue of the Franklin Press, Quintin Ellison and Barbara McRae report that Macon Bank has filed lawsuits alleging it was “duped into making questionable loans in excess of $3.5 million” to buyers of lots in the 2200 acre Wildflower development north of Franklin.




One lawsuit charges that Beverly-Hanks Mortgage Services of Asheville defied the bank’s instructions by setting up interest cash-back deals for borrowers. Macon Bank is suing Beverly-Hanks for breach of contract, fraud, constructive fraud/breach of fiduciary duties, negligent misrepresentation, unfair and deceptive trade practices and participation in racketeer influenced and corrupt organizations.

The bank is also suing its own closing attorney, Steve Philo of Franklin, for professional malpractice and breach of contract.

In 2005, Ultima Carolina announced plans for the Wildflower development in the Cowee Mountain area, to feature 400 home sites and amenities aimed at upscale buyers. So far, only one house has been built in the development.

Of the 151 property owners who’ve bought lots at Wildflower, 31 have defaulted on their mortgage payments so far. In the suit, Macon Bank states that a “wave of defaults” is anticipated.

While seven of the lot owners list North Carolina addresses, 33 list California addresses.

From the Franklin Press article:

Macon Bank alleges that after it discovered the cash-back agreement, officials learned that the real estate investment promoters were conducting seminars to encourage investors to buy Wildflower lots, “pay the interest with cash-back from the developer, and then ‘flip’ the property at a profit when the money from the interest cash-back ran out.”

Beverly-Hanks, the bank alleged, knew or should have known that some or all of the borrowers were investors who did not plan to build their primary or secondary residence in Wildflower, a stipulation required in the bank’s lot loan program.

The Ultima Carolina website:
http://www.ultima-carolina.com/


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10 comments:

Anonymous said...

..."and the walls come a tumblin down...down...down...down.."

I can't imagine what the Skyships Over Cashiers beings must think of humanoids.



Embarassed to be a humanoid

Anonymous said...

Resently Riverstone Deveiopment Group signs (the short ones stuck in the ground) are appearing on the side of the road at entrances to WCU and the Rec Dept.
Do you think they are now available to build a home for a local? A first and only home not a second or third home? The testimonials on the website do not have recent dates except for a professional...
one of the trucks had a license tag "MEGABAD" when they first opened the Sylva Office. Wonder what that means?

GULAHIYI said...

"MEGABAD"? I would say it means that his other vehicle is a Harley-Davidson...a very loud Harley-Davidson.

Good question about Riverstone, though. I don't know what they're up to, although I notice they've been littering the neighborhood with their tacky signs. Do people still build first and only homes in Jackson County?

I'd like to know more about these characters. They probably are "MEGABAD."

Anonymous said...

Wildflower will make it over time.The project is almost paid for and the developers don't owe any money.There is a multi-million dollar clubhouse and 6 homes already built.Looks like a lot of people bought lots that couldn't afford them.Why didn't the loan officers at the bank catch that?
Macon Bank has made a lot of bad dev. loans.River Walk in Highlands,bankrupt,Porter Creek in Franklin,bankrupt and short sold to an insider.Wilderness Trail in Cullowhee bankrupt.I think the FBI needs to investigate Macon Bank.Looks like might be some shenanighans going on.

Anonymous said...

If you can find 6 completed houses in there let me know where they are ? There is a clubhouse, 2 cabins( built by the developer) and 1 private residence, and I believe no individual has built a home in there for 2 years. Why would someone who was sucked into there "10% off goes into escrow and you can flip it before your payments run out" not at this point be looking into walking away ? The land will never be worth what they paid for it when people are foreclosing left and right and having fire sales at $29,900

Anonymous said...

In the future these developments will be full of homes and the community will thrive.

GULAHIYI said...

And so, my friend, are you employed by Ultima...or by Macon Bank...or...?

It's too bad the taxpayers are forced to subsidize these developments by paying for the cleanup and collateral damage that results from shoddy practices...financial and environmental.

Anonymous said...

Taxpayers don't pay for these developments.More disinformation from you.Wildflower has no shoddy practices.The roads are built by the finest engineers and road builder in WNC, Tigerpaw.There is no environmental problem.All permits are in place.You are just an anti development wacko with a blog.

GULAHIYI said...

OK, Mr. Ultima. The post above is an accurate summary of the article that appeared in the Franklin newspaper. If you have an issue with the published report, I suggest you take it up with the newspaper or the reporter.

When mega-developments start carving up the mountains, causing landslides and increased erosion and sedimentation downstream, the taxpayers do foot the bill in a number of ways for cleanup and mitigation. The problems continue long after the developments go bankrupt or otherwise shirk responsbility for their actions.

Taxpayers, and bank customers, ultimately cover the shortfalls when massive foreclosures occur on lots (grossly over-appraised lots, by the way) in unfinished developments.

Regarding your claim that I am an anti-development wacko, I am anti-IRRESPONSIBLE development wacko.

I have singled out four developments for extensive coverage in this blog - Village of Penland, Legasus, Balsam Mountain Preserve and Big Ridge (Rabuffo).

If you want to defend those developments as sterling examples of what we need more of in these mountains then start you own blog.

Otherwise, get off my ass for simply sharing something I read in the newspaper. I've dealt with your kind many times over the years, and all you are able to see is dollar signs.

I have more respect for those who are honest about their willingness to rape the mountains to make a fast buck. My contempt is reserved for those who proclaim their intentions to be "good neighbors and stewards of the environment" while proceeding to rape the mountains to make a fast buck.

Check back in with me AFTER your beloved Wildflower development is full of homes and thriving, Mr. Ultima. I've posted your self-serving crap here twice and that's two times more than you deserve.

(Have you sold your Ultima development in Sylva yet, the one where you created an eyesore on the mountain to jam a road in to it?)

GULAHIYI said...

Clarification - I was addressing you as "Mr. Ultima" but I understand your "handle" of choice is "Mr. Clean" - correct?

I wasn't planning to post anything more on your beloved development, but maybe I should reconsider.