Homeowners' dreams shattered by home building company
From a frustrated family in Stanwood to an angry one in Centralia, the KING 5 Investigators have found disappointed new homeowners across Western Washington who bought from Reality Homes in Fife. Don Lehman's troubles really took hold when the framing on his Mason County house couldn't pass inspection. An engineer's report called it "grossly defective" and said "parts of the house could fail (and cause) significant structural damage."

Investigators: Homeowners' dreams shattered by home building company
Friday, November 3, 2006
By JESSE JONES / KING 5 News 

SEATTLE - From a frustrated family in Stanwood to an angry one in Centralia, the KING 5 Investigators have found disappointed new homeowners across Western Washington who bought from Reality Homes in Fife.

Reality Homes has built more than 1,200 houses in Washington and Oregon since 2002. They pride themselves on building affordable homes, says General Manager Pat Eppright.

"We give them the opportunity to buy a home when they otherwise would not have been able to," Eppright said.

Many get the house they pay for on time, but the ones who don't have stories to tell.

"You just keep paying and paying and paying while they don't do anything," exasperated Reality Homes customer Todd England told KING 5.

Michelle Rylands, another Reality customer, said they just didn't finish the job. "In the end it was like they just kind of forgot about our house altogether."

In August, Rylands paid almost $9,000 for drywall installation for her Centralia home.

Reality signed off on the work, but two months later the house failed inspection, in part because the drywall work was never finished.

"Why would you take all the money if you knew it wasn't done?" she asked.

Rylands says she called Reality for weeks. Fed up, she finished the work herself.

"When were they going to get to it? Six months from now? Eight months from now?"

Todd England says he waited more than two months for Reality to fix construction problems in his Stanwood home.

The delays were too costly and he moved in. "It was financially more feasible to close the loan, get the occupancy and close the loan than to let it drag out," he explained.

Don Lehman's troubles really took hold when the framing on his Mason County house couldn't pass inspection. An engineer's report called it "grossly defective" and said "parts of the house could fail (and cause) significant structural damage."

"Our house is at risk," Lehman said.

When Reality sent the same framer back for what they said was an easy fix, Lehman kicked him off the property and stopped paying.

It was a big mistake.

Lehman, Rylands and England all found themselves trapped by the contract they signed.

"I think the key problem with this contract is that there is no effective remedy if the contractor doesn't perform its job," UW Law Professor Kate O'Neill said after examining Reality's contract at our request. O'Neill says the contract borders on unconscionable.

"Frankly I don't think any business ought to be drafting a contract like this for consumers in the first place," she said.

In Michelle Rylands' case, Reality used the contract to say the two month delay was acceptable.

Eppright claimed Rylands never gave them the opportunity to the work, which they would have completed.

Rylands disagrees. "The time is all put on you. You have all these deadlines you have to reach or they are going to charge you, but if they don't reach their deadlines, 'we have an extension of time clause, we don't have to do that, we don't owe you anything.' "

In Don Lehman's case, Reality again used the contract to say Lehman had to pay even though the framing failed inspection. An arbitrator agreed, ordering Lehman to pay $20,000.

When asked if the company does what's right, or follows the contract, Eppright paused, then said, "we always try to do what's right."

The Lehmans finished their home themselves. Now $60,000 in legal bills are forcing them into bankruptcy.

And their greatest asset is their troubled home.

"If I hear a crack, my first instinct is to leave the house," Margaret Lehman said, "because I don't know what's going to happen."

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