Clayton Homes has used a pattern of deception to help extract billions from poor customers around the country — particularly people of color, who make up a substantial and growing portion of its business. The company is controlled by Warren Buffett, one of the world’s richest men.

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Third of a series

GALLUP, N.M. — After a few years living with her sister, Rose Mary Zunie, 59, was ready to move into a place of her own.

So, on an arid Saturday morning this past summer, the sisters piled into a friend’s pickup truck and headed for a mobile-home sales lot here just outside the impoverished Navajo reservation.

The women — one in a long, colorful tribal skirt, another wearing turquoise jewelry, a traditional talisman against evil — were steered to a salesman who spoke Navajo, just like the voice on the store’s radio ads.

He walked them through Clayton-built homes on the lot, then into the sales center, passing a banner and posters promoting one subprime lender: Vanderbilt Mortgage, a Clayton subsidiary. Inside, he handed them a Vanderbilt sales pamphlet.

“Vanderbilt is the only one that finances on the reservation,” he told the women.

His claim, which the women caught on tape, was a lie. And it was illegal.

Clayton Homes’ sales lot in Gallup, N.M., markets the dream of homeownership to Navajo people, many of whom live in poverty. (Donovan Quintero)
Clayton Homes’ sales lot in Gallup, N.M., markets the dream of homeownership to Navajo people, many of whom live in poverty. (Donovan Quintero)

It is just one in a pattern of deceptions that Clayton has used to help extract billions from poor customers around the country — particularly people of color, who make up a substantial and growing portion of its business.

The company is controlled by Warren Buffett, one of the world’s richest men, but its methods hardly match Buffett’s honest, folksy image: Clayton systematically pursues unwitting minority homebuyers and baits them into costly subprime loans, many of which are doomed to fail, an investigation by The Seattle Times and BuzzFeed News has found.

Clayton’s predatory practices have damaged minority communities — from rural black enclaves in the Louisiana Delta, across Spanish-speaking swaths of Texas, to Native American reservations in the Southwest. Many customers end up losing their homes, thousands of dollars in down payments, or even land they’d owned outright.

Over the 12 years since Buffett’s Berkshire Hathaway bought Clayton Homes Inc., the company has grown to dominate virtually every aspect of America’s mobile-home industry. It builds nearly half the new manufactured homes sold in this country every year, making it the most prolific U.S. homebuilder of any type. It sells them through a network of more than 1,600 dealerships. And it finances more mobile-home loans than any other lender by a factor of more than seven.

In minority communities, Clayton’s grip on the lending market verges on monopolistic: Last year, according to federal data, Clayton made 72 percent of the loans to black people who financed mobile homes.

The company’s in-house lender, Vanderbilt Mortgage, charges minority borrowers substantially higher rates, on average, than their white counterparts. In fact, federal data shows that Vanderbilt typically charges black people who make over $75,000 a year slightly more than white people who make only $35,000.

Through a spokeswoman earlier this month, Buffett declined to discuss racial issues at Clayton Homes, and a reporter who attempted to contact him at his home was turned away by security.

Clayton and Berkshire Hathaway did not respond to numerous requests for interviews with executives, delivered by phone and email, as well as in person at Berkshire Hathaway’s headquarters in Omaha. The companies did not answer any of 34 detailed questions about Clayton and its practices. Nor did they respond to an extensive summary of this article’s findings, provided along with an invitation to comment. On its website, Clayton says that it seeks to “treat people right” and “preserve our integrity above all else.”

Clayton Homes, the largest U.S. builder of mobile homes, sells them through a network of more than 1,600 dealerships. It also finances more mobile-home loans than any other lender by a factor of more than seven.  

(After publication of this article, Clayton issued a news release, accusing the reporters of “activism masquerading as journalism” and stating: “We categorically and adamantly deny discriminating against customers or team members based on race or ethnicity.” For two specific categories of loans, the company said, minorities pay the same or slightly lower interest rates than whites.)

Clayton has expanded its minority customer base — 31 percent of its loans went to minorities last year, up from 22 percent in 2008 — with the help of meticulous demographic analysis and targeted sales promotions. Spanish-language ads in Texas promise Latino immigrants without Social Security numbers that they, too, can enjoy the American dream of homeownership.

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As it drew in more Latino customers, however, Clayton’s practice was not to provide Spanish-speaking customers with translated loan documents or interpreters at closing — even after employees at headquarters complained that too many customers were being misled about loan terms.

Fair-housing laws prohibit lenders from targeting and overcharging people of color, whose communities historically were denied access to credit.

Clayton’s practices are part of a corporate culture that has condoned racism, including black employees fired while white workers used discriminatory slurs and kept their jobs, and phone collectors casually insulting borrowers with racist stereotypes.

For an earlier story in this series that detailed Clayton’s widespread abuse of borrowers, a Clayton spokeswoman said in a statement that the company helps customers find homes within their budgets and has a “purpose of opening doors to a better life, one home at a time.” Buffett later defended the company, telling Berkshire Hathaway shareholders he “makes no apologies whatsoever about Clayton’s lending terms.”

For this story, The Seattle Times and BuzzFeed News analyzed hundreds of internal company documents, thousands of legal and regulatory filings, more than 40 hours of internal company audio recordings and federal data on hundreds of thousands of mobile-home loans over a decade. Reporters conducted interviews with more than 280 customers, employees and experts, including some Clayton insiders who said they were appalled by the company’s practices.

Meanwhile, in the first nine months of this year, Clayton generated more than half a billion dollars in profit, up 28 percent from the same period last year.

“It’s a perpetual system of people who are never able to get themselves out of the hole,” said Gwen Schablik, who worked as a collector and handled borrowers’ bankruptcies at Clayton’s Maryville, Tenn., headquarters from 2011 until she quit in 2014.

“I felt, ethically, I couldn’t continue working there,” she said.

A culture of racism

David Ashley’s problems at Clayton began soon after he became one of the few black employees to serve in management.

One of Ashley’s subordinates called him a “coon,” and he fired her, he said. To his dismay, a regional manager overruled the decision and warned Ashley not to be so hasty, he said.

Ashley said his bosses grew eager to push him out of his role managing a Clayton lot in Arkansas, even suggesting he had taken some furniture that various employees brought in and out of the lot for staging homes — an accusation that another black manager in the region reported facing around the same time. Both denied taking any furniture.

When they offered Ashley a transfer to a sales lot far from his home, he said, he declined and eventually left his job in December 2012.

The Mobile-Home Trap

Billionaire philanthropist Warren Buffett controls a mobile-home empire that promises low-income borrowers affordable houses. But all too often, it traps those owners in high-interest loans and rapidly depreciating homes.  
  Kirk and Patricia Ackley spent thousands to prepare their land, then were stuck with a higher loan rate than promised. Their home was taken by Berkshire Hathaway-owned Clayton Homes in 2012. (Katie G. Cotterill and Lauren Frohne / The Seattle Times)   MORE

“I’m almost a 60-year-old man,” he said earlier this year. “It’s the first time — living in Arkansas my whole life — and it was truly the first time that I had experienced true racism.”

In at least six states, Clayton managers have permitted open racial hostility toward people of color, according to interviews and legal filings by more than 15 former workers with direct knowledge of the incidents. In at least seven cases documented in court records, sales reps — both black and white — were fired after complaining about racism on the job. Four cases were dropped or dismissed, and Clayton settled three.

After one of those firings in South Carolina in 2010, the company hired another black salesman. But that man, Larry Summers, testified in court records that Clayton’s workers, despite his many requests, did not train him. He also said that he witnessed a co-worker make racist comments and that black customers were treated with contempt.

“When I was there, I saw they treated black customers differently than what they did white customers, you know?” he said in a deposition. “With their white customers, they’re more pleasant.” He said he soon quit Clayton.

In Baton Rouge, La., Clayton managers engaged in “malicious and reckless conduct” by allowing employees to harass and fire the store’s only black salesman, according to a lawsuit filed by the federal government against the company in 2007.

A regional manager knew about the harassment, four former employees, including the victim, Melvin McNeal, said in interviews. McNeal said he complained about being called “Sambo” and “Buckwheat,” but managers defended his colleagues, saying they were “having fun” with him. Two of McNeal’s white co-workers backed up his complaints to managers, according to legal filings. They, too, reported being fired.

“I can’t help myself, I hate n—–s,” McNeal’s main harasser told a contractor on the sales lot, according to a separate lawsuit filed by the two white co-workers. One remembered the harasser calling the sales lot “n—–ville” when black customers arrived to tour homes.

The suit by the two white employees was dismissed for procedural reasons. Clayton settled the federal lawsuit, brought by the Equal Employment Opportunity Commission, in part by agreeing to end racial harassment. The company did not admit or deny wrongdoing.

Steering customers

Laws designed to protect consumers prohibit mobile-home sales reps from doing double duty as loan officers unless they obtain a separate license. They can sell the mobile home, but they may not guide buyers to a particular financing option.

Peter Shaw, who manages Clayton’s lot in Gallup, N.M., denied that his employees steer Navajo buyers to Vanderbilt loans. He is “100 percent” sure it doesn’t happen, he said, because the company trains its workers that doing so would be “strictly against the law.”

Yet in three dozen interviews, Clayton’s minority customers said they were led to believe that Vanderbilt was the only option to finance their homes.

One of the Navajo women at the Gallup lot recorded audio of their shopping experience, including the exchange in which a sales agent told them Vanderbilt was the only financing option on the reservation. Even after being told of the recording and its contents, Shaw insisted that his employees follow the law.

The company’s in-house lender, Vanderbilt Mortgage, charges minority borrowers substantially higher rates, on average, than their white counterparts. In fact, federal data shows Vanderbilt typically charges black people who make more than $75,000 a year slightly more than white people who make only $35,000.  

In fact, there is a range of options for financing mobile-home purchases on the reservation. Many lenders make loans under a federal program created in 1992 to improve Native Americans’ access to home financing. Known as the 184 Program, the subsidy guarantees that banks won’t lose money on the loans. This allows them to offer interest rates comparable to a prime home mortgage.

The Navajo Nation itself also offers loans to finance mobile homes. Louise Johnson, the head of Navajo Nation’s credit-services division, said tribal leaders developed the program after seeing widespread repossessions of mobile homes on the reservation. Her division offers mobile-home loans with an interest rate often under 6.5 percent — half the rate paid by many Clayton borrowers. Yet few Navajo buyers end up borrowing from the tribe.

When he defended Clayton’s compliance with the law earlier this year, Buffett said the company’s lots use “lender boards” on their walls to show buyers the array of finance options to choose from. But the lender board at the Gallup lot, just five miles from tribal territory, had no information about Navajo credit services. It did list a lender that participates in the federal program. In an interview, however, Shaw dismissed the program as a poor option for many borrowers.

The lender board also has a single large red button labeled, “PUSH ME.” By law, Clayton sales agents aren’t allowed to pitch for Vanderbilt. But if they or a customer presses the red button, a digital recording does it for them:

“Vanderbilt wants to finance your home. Fast approval. Friendly service. And less than perfect credit accepted,” a voice says. “Choose Vanderbilt!”

A colorful poster heralds Clayton’s Vanderbilt brand as “YOUR #1 CHOICE IN LENDING.” The red button plays a voice recording that makes a pitch Clayton sales agents aren’t legally allowed to make. (Mike Baker)
A colorful poster heralds Clayton’s Vanderbilt brand as “YOUR #1 CHOICE IN LENDING.” The red button plays a voice recording that makes a pitch Clayton sales agents aren’t legally allowed to make. (Mike Baker)

For years, salesmen received a bigger cut of the sales price if borrowers financed with Vanderbilt. That’s no longer the case, but management has imposed new pressures.

Clayton tracks each lot’s “capture rate,” or what percentage of its buyers borrow from Vanderbilt, internal records show. Managers receive reports that show how their capture rate ranks against other lots’ and how their rate has changed over time. Last year, dozens of lots had capture rates exceeding 70 percent, the records show.

Earlier this year, a Clayton retail vice president emailed fellow managers demanding that they explain why some stores fell short of their goals.

“I know some of you are frustrated with your capture rates, as well as [retail lots] not hitting their commitments,” Mark Morgan wrote in the email, a copy of which was obtained by The Times and BuzzFeed News. “They will never get to where we need them to be if they don’t buy in. We must help get them there.”

Papers not translated

Clayton has been especially effective at capturing minority borrowers — and not just Native Americans.

Vanderbilt and Clayton’s other lending division, 21st Mortgage, originated 53 percent of all mobile-home loans to Native Americans; 56 percent of loans to Latino and Hispanic borrowers; and 72 percent to blacks, according to 2014 federal loan data from some 7,000 lenders. Among white borrowers who were not also identified as Latino or Hispanic, Clayton’s market share was 31 percent.

In Texas, Clayton has blanketed parts of the state with ads, fliers and promotions in Spanish. One store promised to spare buyers the frustration of dealing with “Spanglish”-speaking sales agents: “Stop suffering, come to Clayton Homes in Seguin, where we will attend to you 100% in SPANISH!!!!” its website said.

Clayton was less reliant on lending to minorities in 2004, the first full year after Buffett’s Berkshire Hathaway bought the company for $1.7 billion. Around that time, then-marketing manager Robert Fox explained in a recent interview, Clayton was beginning to harness emerging research tools to help identify untapped markets.

After analyzing its Vanderbilt loan portfolio to understand the demographics of its customers, he recalled, Clayton then searched for areas where these market segments — people with similar characteristics — were clustered. For one presentation in 2005, Fox mapped Houston-area ZIP codes where these potential customers lived. Four of the five market segments he highlighted were identified as ethnically mixed.

“It was extremely cutting-edge for the manufactured-home industry,” Fox said.

More recently, Clayton has drawn in minority borrowers with targeted marketing, such as sponsorship of a Lumbee Tribe powwow in North Carolina. Louisiana dealerships have advertised single-parent loan programs in a state where black families are more than twice as likely as white families to be headed by a single parent.

And in Texas, Clayton has blanketed parts of the state with ads, fliers and promotions in Spanish. One store promised to spare buyers the frustration of dealing with “Spanglish” speaking sales agents: “Stop suffering, come to Clayton Homes in Seguin, where we will attend to you 100% in SPANISH!!!!” its website said.

Another lot’s Spanish-language ad addressed immigrants who have government tax ID numbers but no Social Security number: “No credit, no Social! Your ITIN and your promise is all we need!”

But when the time came to sign a legally binding loan, the company’s Spanish language skills disappeared. Its practice was to provide loan documents, full of dense legal jargon, in English, and not to provide interpreters, according to 12 Spanish-speaking borrowers who purchased homes in Texas over the past few years.

That’s how Rocio Orozco, a single mother living in rural Willis, Texas, who speaks only enough English to carry on a simple conversation, said she ended up paying nearly double the interest rate she was promised — and losing $500 of her down payment to her local Clayton-owned dealer before she’d even signed the contract.

After driving past Clayton’s dealerships on her way to work each day, Orozco, a manager at Subway sandwich shops, stopped at a Clayton-owned lot in early 2012 to “window shop,” she said in an interview conducted through a translator. She said she told the sales reps that she didn’t have good enough credit for a loan. Still, she recalled, the rep went to lunch with her, talked to her about their families and told her not to give up hope.

Before Vanderbilt would process her application, Orozco recalled, she was asked for a $500 deposit, delivered on a blank money order. The loan for a double-wide came through, but the $500 disappeared. Documents indicate it was not credited against the cost of her home. In fact, the loan balance was inflated by $5,866 in fees and Clayton-brokered insurance, nearly as much as her down payment. She hadn’t noticed the additional charges until a reporter pointed them out.

She expressed further dismay when the reporter noted that she is paying a 14.2 annual percentage rate on the 20-year loan. The saleswoman had told her she was approved at 8 percent, Orozco said. At the loan closing, the title agent referred by Clayton rushed her through the process, showing her only the blanks on pages requiring her signature, Orozco said.

I thought I could understand it myself, and trust them, because they were so nice. But that all changed the second I signed that paper.” - Rocio Orozco

“I said I couldn’t understand them, but they told me it was all simple, just stuff the bank required,” Orozco said. On the way out the door, she said, she was handed a stack of documents that she had never had a chance to review.

Among them was a loan application, prepared by Clayton, stating that she made $4,770 a month — far more, she said, than her actual take-home salary.

Joan Norman, Orozco’s saleswoman, said she couldn’t imagine a case where retail workers would ask for a money order to be left blank. Norman, who no longer works for Clayton, could not explain why the $500 deposit was reflected on some documents but never applied against the cost of Orozco’s home.

Now facing monthly payments of about $1,000 that overwhelm her budget, Orozco said she is almost certain to lose the home.

“I’m so stupid,” she said. “I thought I could understand it myself, and trust them, because they were so nice. But that all changed the second I signed that paper.”

Rocio Orozco, right, a single mother in Willis, Texas, said she was rushed through her loan closing and ended up with an interest rate of 14.2 percent, far higher than the 8 percent she’d been promised. (Scott Dalton for BuzzFeed News)
Rocio Orozco, right, a single mother in Willis, Texas, said she was rushed through her loan closing and ended up with an interest rate of 14.2 percent, far higher than the 8 percent she’d been promised. (Scott Dalton for BuzzFeed News)

Gwen Schablik said stories like that make her blood boil. Schablik was one of a handful of Spanish speakers working in collections at Clayton back in 2012. Every week, she said, she took calls from people whose weak command of English led them to sign loan documents they couldn’t understand.

Schablik and another former employee said several Vanderbilt staffers had raised the issue with their superiors. Managers eventually told Schablik that there was no need to translate the documents, she said.

She continued to raise concerns, writing in an email to Clayton’s director of marketing that when she spoke to new borrowers “there were many things they were not made aware about during the sale.”

Managers and executives, she said, dismissed her concerns; she recalled one replying, “It doesn’t really matter as long as we get the money.”

More than a dozen Spanish-speaking borrowers in Texas said they initially dealt with friendly, Spanish-speaking retail staff, only to be rushed through loan closings that the borrowers didn’t understand, conducted entirely in English. Many said they were surprised to find that the loan terms were much more costly than they’d been told.

Vanderbilt piles on

Blacks, Latinos and Native Americans tend to have lower median incomes and lower credit scores than white Americans. As a result, the loans they receive — for houses, cars or virtually anything else — often have higher interest rates. So Vanderbilt is not alone in charging minority customers more, on average, to finance their mobile homes. What sets the company apart is just how much more.

The gap between Vanderbilt’s disclosed interest rates for whites and those for minorities — more than 0.7 percentage points on the annual rate — is the largest among big mobile-home lenders. That difference can amount to thousands of dollars over the life of an average loan. The disparity persists even after adjusting for income: Minority borrowers earning between $75,000 and $100,000 on average pay interest rates slightly higher than those paid by Vanderbilt’s white borrowers making only $25,000 to $50,000, according to a Seattle Times-BuzzFeed News analysis of recent federal loan data.

Some Clayton sales people try to foist Vanderbilt’s costlier loans on customers — in particular poor, minority borrowers — who may have less familiarity with financial documents or who may be less likely to question large tacked-on fees, said three former Clayton workers, including Morris “Cubby” Stone, one of the white Baton Rouge employees who reported being fired after defending a colleague who faced racial abuse.

In at least six states, Clayton managers have permitted open racial hostility toward people of color, according to interviews and legal filings by more than 15 former workers with direct knowledge of the incidents.

For decades, until federal fair-housing laws were introduced in the 1960s, banks routinely engaged in “redlining” — literally drawing red lines on maps around minority communities where they would refuse to make loans or open branches.

Clayton appears to have engaged in reverse redlining, seeking out minorities and charging them higher rates, according to a review of company documents, interviews, and an analysis of federal loan data. “Absolutely classic reverse redlining,” attorney John Relman called it.

The practice may violate the federal Fair Housing Act or the Equal Credit Opportunity Act, said Relman, who represented the city of Baltimore in a suit against Wells Fargo for reverse redlining. (The bank, which did not admit wrongdoing, settled, agreeing to spend millions of dollars on housing initiatives.)

(In its news release after this article’s publication, Clayton said that “we do not ‘target’ minority markets or engage in ‘reverse-redlining.’”)

In Louisiana, where Clayton controls 80 percent of the market for mobile-home loans to black people, the company sold Helen Shorts, a disabled grandmother, a loan she had virtually no chance of repaying.

Shorts, who is black, said she lost her previous home to a fire in 2013, leaving her and her family with almost nothing but the clothes they were wearing. Barely able to afford food, she said, they relied on handouts from churches and slept on friends’ floors.

When her insurance check finally arrived early last year, Shorts recalled, she and her husband, Leroy, were desperate to turn it into permanent housing for the three grandchildren they look after. She and a girlfriend drove more than 50 miles to a Clayton sales lot in Gonzales, La., that, she said, had advertised homes for as little as $7,000.

Shorts went into the store looking for payments of $300 to $400 a month, she said, something she could afford on her $749 in monthly disability benefits.

The saleswoman, she recalled, later told her that she was lucky to qualify for a loan on a bigger, used mobile home priced at $55,000. Clayton financed it for her with a Vanderbilt loan at a 15.77 annual percentage rate, after a down payment of $7,000.

When she and Leroy returned for the closing, they said that, like many other buyers, they were rushed through it. Agents quickly turned over page after page, saying, “You need to sign right here, sign here, sign here,” recalled Leroy, who said he has been unable to work since he went blind in his right eye.

The monthly payments were $851 — about $100 more than the amount she received from her fixed disability payments. Shorts, who said she didn’t realize how much she would have to pay every month, made just two payments, then defaulted in June 2014. Clayton filed to seize the home that October.

Even when loans go bad quickly, the sale can be profitable for Berkshire Hathaway. Clayton often marks up new homes about 70 percent over invoice, company documents show. After a 20 percent down payment and thousands of dollars in fees added into the loan, Clayton can recoup more than half the wholesale price of the home in a year.

When borrowers stop paying, the company can repossess and resell the home, again with another markup.

Leroy and Helen Shorts stand outside the mobile home they share with their grandchildren in Jackson, La. (William Widmer for BuzzFeed News)
Leroy and Helen Shorts stand outside the mobile home they share with their grandchildren in Jackson, La. Their previous home burned in 2013; now they may lose this one, too. (William Widmer for BuzzFeed News)

Threats, mockery

Arriving at Clayton’s Maryville, Tenn., headquarters each morning, collections workers and their colleagues shuffle past a poster of Warren Buffett pointing to his “rule of thumb.”

“I want employees to ask themselves whether they are willing to have any contemplated act appear the next day on the front page of their local paper — to be read by their spouses, children and friends — with the reporting done by an informed and critical reporter,” it reads.

The company’s practice was to provide loan documents, full of dense legal jargon, in English, and not to provide interpreters, according to 12 Spanish-speaking borrowers who purchased homes in Texas over the past few years.

“I’d pass by that and I was just, like, ‘Are you kidding me?’ ” said Schablik, the Spanish-speaking employee who, until last year, worked as a Clayton collector and handled borrowers’ bankruptcies.

At first, Vanderbilt collection agents — often young, white college students or recent grads — are trained to do things by the book, Schablik and four current and former collectors said. But when these new agents begin working the phones, they said, managers pressure them to be “mean” or “condescending,” for example telling customers behind in their payments to cut back on groceries or forgo medical care.

Much of collectors’ take-home pay comes from bonuses tied to how many delinquent accounts they bring up to date. As a result, Schablik and several of her former colleagues said, many collectors resorted to tactics of questionable legality: making groundless threats, calling relatives or employers to apply pressure, or berating borrowers until they either cried or figured out how to get some money. Collectors typically were less abusive to white borrowers, they said.

Even when managers were within earshot, white agents openly ridiculed black borrowers, mimicking stereotypical black vernacular on the phone, then referring to them as “n—–s” after hanging up, Schablik and other current and former Clayton employees said. Two collectors recalled English-speaking co-workers talking to Latino borrowers, repeatedly saying, “No dinero, no casa.” One collector said she overheard a colleague ask a black borrower if she’d spent all of her money on a hair weave.

On the Navajo reservation, a customer named Sheila Begay said Vanderbilt collection agents told her that Navajo people are “too stupid” to understand loan terms. Her stepfather, Daniel Teller, said they told him Navajos were so poor that they never have money in their pockets. A neighbor, Wallace Archer, recalled a collector asking whether his family had spent all of its money on alcohol.

Sheila Begay leans against a fence protecting a water line where her three-bedroom home once stood in Chinle, Ariz. (Donovan Quintero / Special to The Seattle Times)
Sheila Begay leans against a fence protecting a water line where her three-bedroom home once stood in Chinle, Ariz. Her home was repossessed after she was injured, lost her job and couldn’t make payments. (Donovan Quintero / Special to The Seattle Times)

Tim Williams, the head of one of Clayton’s lending subsidiaries, 21st Mortgage, said in a brief interview that his collectors are trained to treat customers with respect. He said accusations that they demeaned borrowers were “very, very unlikely” to be true.

“Believe it or not, not all customers are honest,” he said.

At the tail end of the Mississippi Delta, southeast of New Orleans, Jennifer Encalade said she was receiving calls from Clayton’s collection agents multiple times a day this summer. One afternoon, while a reporter was visiting, an agent named Jeremy called and began asking questions about her personal life, her financial status and her family. She put the call on speakerphone.

Dissatisfied with her offer to send money after her next payday, Jeremy began to bat around ideas: Is there anyone she could borrow the money from? Was there anything she could pawn or sell? Why didn’t she try something?

As her 5-year-old son played quietly on the carpet, Jennifer asked:

“What would you suggest?”

“Uh, donate plasma?” Jeremy replied. “Or donate blood?”

Family legacy taken

In minority communities across the American South where Clayton has established dominance, the company seizes homes and land and resells them in a churn that strips individuals of their assets and communities from holding and building wealth.

On the Navajo reservation, geographically larger than the state of West Virginia, there are fewer than 50,000 occupied housing units of any kind. Clayton has sought to seize homes at least 691 times on the reservation in the past decade, according to a review of records from eight of the Navajo Nation’s 11 court districts.

In the rural farming town of Opelousas, La., Kevin Thibodeaux is trying to keep Vanderbilt from taking a piece of land on Lazard Lane that has been in his family for at least four generations. Along the lane are the homes of his mother, aunts and uncles.

“When you turn down that road, it’s all family back here,” Thibodeaux said. “It goes deep, man.”

Like many black families in the area, the Thibodeauxs see owning land as a tangible expression of family roots stretching back to Reconstruction and an economic toehold gained despite the legacy of slavery and the hardships of Jim Crow. In this community beset by poverty, land is many families’ most meaningful asset.

In 2009, Thibodeaux was working at Wal-Mart and his wife at a pharmacy as they raised three children. He figured their weak credit would make it impossible to buy a home. When he visited a Clayton-owned retail lot, however, the sales reps told him they could get him a loan — if he put up a piece of land.

Thibodeaux had a parcel he’d bought from his aunt informally, years earlier. Employees at the Clayton-owned lot helped with the paperwork needed to make him the land’s official owner, he said, and he signed it over as collateral.

Thibodeaux said he was excited about a Clayton home model called “YES,” priced at $39,000. A Clayton saleswoman, he recalled, said she was trying to get him a government-insured loan. Nearly three months later, he said, she called and told him that Vanderbilt would be his lender. She did not mention that the same company that owned the retail lot also owned the lender, he said. His annual percentage rate ended up at 11.26.

In the months he waited for the loan to come through, the home’s price went up — to a little over $45,000, plus more than $7,000 in fees and insurance brokered by Clayton.

Within a couple of years, his wife had left him, leaving him with the kids, and he lost his job.

In light of his two years of steady payments, he asked Vanderbilt to adjust his monthly obligation until he got back on his feet. But, he said, “They gave me nothing. I tried everything talking to these people.”

Vanderbilt moved to seize Thibodeaux’s home in January 2014. He filed for bankruptcy protection and has been paying down his debts. With his new job as a school janitor, Thibodeaux hopes he can hold onto the house and land, but there are no guarantees.

Today, Thibodeaux shares the home with his girlfriend, Linda Lazard, and their children. Lazard, whose sister previously lost family land to Vanderbilt, can rattle off the names of nearby friends and relatives whose lives have been disrupted by the company’s aggressive lending and frequent repossessions.

“Boy, for Thanksgiving and holidays, we’ll hear something about Vanderbilt or somebody walking up and saying, ‘Oh, I got my house, and Vanderbilt financed me,’ ” Lazard said. “Everybody look like, ‘Lord Jesus, do you know what you just got yourself into?’ ”

With dusk falling over Lazard Lane’s majestic trees one recent evening, Thibodeaux’s extended family gathered on his wide, patchy lawn for a cookout featuring fried turkey wings. As high school-aged daughters practiced their cheer-squad drills, Thibodeaux talked about his troubles with Clayton Homes and Vanderbilt Mortgage.

“They sold me a dream,” he said, pacing back and forth. “Everything changed after I bought the home.”

UPDATE: This story has been updated to reflect a response from Clayton Homes issued after this article was published.