Washtenaw County Prosecutor, Consumer Advocates Sue Innovative Apartment Group Over Predatory Subleasing and Debt Collection Scam 

January 15, 2026 — Press Release

Advocates Say Company Exploits Families With Low Credit Scores and Puts Them at Risk of Eviction 

WASHINGTON – Renters in Michigan, and across the nation, face a severe housing shortage – and it is hitting low-income consumers with low credit scores the hardest. A lawsuit filed Monday in Michigan’s 22nd Judicial Court accuses Low Credit Rents, LLC and Hot Perks MI, LLC – known as Innovative Apartment Group – of taking advantage of this harsh reality by targeting families who are saddled with low credit scores and therefore often struggle to find a decent and affordable place to live. Landlords heavily rely on credit scores in the tenant screening process, even though there is no research showing that credit scores and reports accurately actually predict whether a person will pay their rent.

“Despite promising to help Michigan families to obtain stable housing, Innovative Apartment Group exploits the very families they claim to be helping,” said Jennifer Wagner, senior attorney at the National Consumer Law Center (NCLC). “Renters are coming out of these rental agreements with less money and lower credit scores than when they started.”

The class-action lawsuit was filed jointly by renters who have allegedly been victimized by Innovative Apartment Group, and by the Washtenaw County Prosecuting Attorney, acting on behalf of the People of the State of Michigan. The renters are represented by the Center for Civil Justice and the National Consumer Law Center. The lawsuit alleges violations of Michigan’s Consumer Protection Act, Credit Services Protection Act, Regulation of Collection Practices Act, and Occupational Code.

Innovative Apartment Group advertises that it helps families obtain safe and secure housing, while improving the families’ credit so that they can build toward a better life. But in reality, renters face undisclosed high fees and charges, negative credit reporting, and even eviction. 

“Every renter in Michigan deserves to be treated fairly.” said Washtenaw County Prosecuting Attorney Eli Savit. “Companies and landlords who take advantage of the housing crisis and unfair tenant screening practices to mislead renters, place them at greater risk of eviction, and torpedo their credit scores are in violation of Michigan law. Make no mistake: we will hold them accountable.” 

The lawsuit alleges that Innovative Apartment Group leases homes from traditional landlords and then subleases them to families who have the means to make regular rental payments but believe they won’t be able to find housing because of their low credit scores. These subleases are riddled with thousands of dollars of  fees and upcharges, overburdening families. Once a family is in a lease with Innovative Apartment Group, the company often fails to timely transmit their payments to the actual landlord, frequently leading to evictions.

The lawsuit also alleges that Innovative Apartment Group and its debt collection attorney, Velo Associates PLC, which is also a defendant, engage in aggressive debt collection tactics, including collection lawsuits, garnishment, and negative credit reporting, making it even harder for families to secure a new place to live and to maintain stable housing moving forward.

Despite promising to help people repair their credit scores, the lawsuit alleges that Innovative Apartment Group provides no credit-repair services–and, by engaging in negative credit reporting, leaves low-credit individuals worse off than they were before. 

Innovative Apartment Group and its affiliates claim that the inflated costs they impose on tenants are necessary because they bear additional risk; however, they’ve structured their scheme to insulate themselves from risk and to profit off of the transaction regardless of how long the family is able to stay in their subleased rental home. 

“Tenants in these agreements face grossly excessive rent and fees and assume all of the risk of losing their homes and further damaging their credit scores,” said Greg Abler, attorney at the Center for Civil Justice. “Innovative Apartment Group sets families up to fail, and cashes in when they do.”

Michigan law is designed to protect Michiganders by prohibiting companies from engaging in this type of deceptive and illegal conduct. The lawsuit seeks to stop the illegal sublease and debt collection operations and to provide monetary relief for all tenants harmed by this scheme.