Texas, U.S. and Colony Ridge reach settlement on land sales and compliance
A settlement filed in federal court would require Colony Ridge to verify buyers’ legal status, add infrastructure and compliance controls, and restrict future direct land sales.
A federal-court settlement filed Tuesday involving the State of Texas, the federal government and Colony Ridge would require the developer to verify buyers’ legal status, add infrastructure and compliance obligations, and limit future direct land sales.
The agreement resolves enforcement actions brought by the U.S. Department of Justice, the Consumer Financial Protection Bureau and Texas Attorney General Ken Paxton. The source says those actions alleged deceptive sales practices and discriminatory, predatory lending. Colony Ridge denies wrongdoing but agreed to settle.
The settlement would change how Colony Ridge sells land, how it markets properties and how it handles drainage, roads, water and law enforcement support across its subdivisions. It also preserves possible future enforcement by government agencies if the company violates the deal.
Under the agreement, buyers must present an unexpired Texas-issued driver’s license or ID card, or a valid passport and visa. Colony Ridge must also check for terrorism watch list status and possible ties to transnational criminal organizations, and verify compliance with Texas laws that restrict some real estate transactions tied to designated foreign countries. The source says those requirements would effectively shut down future direct land sales to people unlawfully present in the United States.
The settlement also bars Colony Ridge for three years from seeking approval for new residential plats intended for direct-to-consumer land sales. For new subdivisions, the agreement calls for deed restrictions, county permitting compliance, architectural controls and, in many cases, a built home before resale.
Financial terms in the source include at least $48 million for infrastructure improvements. That total includes $18 million for drainage and flood control and $30 million for roads, water, sewage and other public-safety infrastructure. Independent Texas-based engineering firms must reevaluate drainage systems, design improvements for major storm events and conduct recurring inspections.
Another $20 million must go to law enforcement presence over the next decade. Allowed uses include local patrols, Texas Department of Public Safety or county substations, officers, equipment and immigration enforcement partnerships. Any unused money must be redirected to public safety infrastructure.
The agreement also requires Colony Ridge to adopt underwriting standards and a default-avoidance plan. It must provide expanded disclosures on utilities, flood risks, permitting timelines and total ownership cost, and give buyers a limited rescission window under certain conditions after purchase.
On marketing, the company may no longer describe properties as “move-in ready” or fully serviced unless utilities are immediately available. It must use images of actual properties and provide consumer materials in English and Spanish.
The settlement was filed in federal court and describes it as resolving the government’s claims, but it does not include attributed quotes from the parties. The agreement requires Colony Ridge to hire an independent compliance specialist, train employees and file annual reports with state and federal authorities.
The settlement remains subject to court proceedings, and the source says material violations could allow the government to reopen the underlying lawsuits or pursue other legal remedies. The agreement also preserves possible criminal charges, environmental enforcement, tax actions and future civil liability for personal injury or property damage.
Sources
Editorial note: This article was prepared with AI assistance and includes source attribution for reader review.
Comments ()