Farouk Eltawila, a government employee, lives with his fiancee in a virtual ghost town in Potomac.

Eltawila is one of six residents at the 48-unit town house project called the Villas at Potomac Ridge. If he looks out the window of his $352,000 red brick home, he sees half-completed, boarded-up town houses. Because there is no garbage collection at the complex, Eltawila uses a dumpster that is now overflowing with waste. He worries about security, especially at night, because there are no streetlights.

"I've stuck with it because I don't think I can sell it. If I do sell it, I will lose an arm and a leg. A couple of units here have 'For Sale by Owner' signs out, and they have not moved," Eltawila said.

For the residents and prospective residents of the Villas at Potomac Ridge, the story of Capital Sun Corp. -- the Fairfax-based developer of the Villas -- symbolizes everything that can go wrong in buying a home.

In the face of multiple lawsuits brought by subcontractors, Capital Sun halted all work on its Potomac complex in May and at least two other single-family homes it had under construction, leaving prospective residents who had put down $15,000 to $20,000 deposits, subcontractors and other creditors in the lurch.

Officials in the home-building industry say the slowdown in the Washington area real estate market does not mean there will be more ghost-town developments. They say they have not seen any dramatic increases in the number of local builders going bankrupt.

"Capital Sun is an isolated incident," said Roger Snyder, chief executive of the Northern Virginia Building Industry Association.

Attorneys for Capital Sun faced angry subcontractors in an Alexandria bankruptcy court this week. Four subcontractors, who claim Capital Sun owes them more than $500,000 for their work, filed suit against the builder in an effort to force Capital Sun into Chapter 7 involuntary bankruptcy, which would force the firm to liquidate its assets. Another hearing on the suit has been scheduled for Aug. 21.

"It could be a long time until {the subcontractors} ever see funds, if they ever do," said Charles H. Fleischer, an attorney representing the subcontractors.

Meanwhile, Ira Wopert, Capital Sun's attorney, said Washington Federal Savings, from which Capital Sun borrowed about $9 million, will ask the court next week for permission to foreclose on the Villas.

Formed in 1984, Capital Sun has built numerous condominium projects and single-family homes in Fairfax and Montgomery counties. Some of its larger projects, which it built itself or in partnership with other builders, include a 198-unit condominium project called Surrey at Manchester Lakes and Sugar Creek, both in Fairfax County.

The first 12 units of the 48-unit Villas at Potomac Ridge complex went on sale in June 1988. Prices for the three-story town homes ranged from about $300,000 to $450,000. Eltawila, a Nuclear Regulatory Commission staffer, said he attended a sales reception, for which some people had camped out all night to buy lots and house plans offered by Capital Sun for the Villas.

Wopert said the builder had been in good financial condition when it started the Villas but ran into problems "beyond its control."

He blamed Capital Sun's troubles on the soft real estate market, slow sales for the Villas and unanticipated cost overruns at the site. Capital Sun probably will contest the involuntary bankruptcy effort since it would like the chance to reorganize and finish the project, Wopert said.

Richard Wilkinson, president of Capital Sun, could not be reached for comment.

Several buyers who made sizable down payments for town homes at the development now want out of their contracts.

Two years ago, Stephen Greenhouse, a Rockville resident, made an $18,000 down payment on a still-unfinished town house at the Villas. He has since bought another house. "So far I've not gotten one dime back. I want my $18,000 back, and I'm furious," he said.

John Brady, who works at a D.C. law firm, last year paid $15,000 down for his town house. He said he became concerned when construction on his home stalled early this year. In the spring, subcontractors, who said they had not been paid by Capital Sun, ripped air conditioners, cabinets and the furnace out of the unfinished town house, Brady said.

"I want to be the hell out of it. I just want to retrieve my deposit," Brady said, adding that he has not been able to look for another house because his money is tied up in the deposit.

There are 10 people, including Brady and Greenhouse, who have outstanding deposits totaling $132,500 on houses at the Villas at Potomac Ridge, said Frances X. Pugh, an assistant Maryland attorney general.

Under state law, builders have three options for holding security deposits. They can allow a real estate broker to hold all the money or open a separate escrow account for down payments. Capital Sun chose the third option: establishing a bond for the security deposits with a bank. The bank then issues the state a letter of credit certifying that the builder is good for the money.

Capital Sun's bank issued Maryland a letter of credit for $75,000 -- an amount less than the total amount of deposits but in compliance with Maryland law, which states that a builder can have a $75,000 letter of credit for deposits that total $75,000 to $200,000.

"We are in the process of trying to get that money from the bank," Pugh said. "This is the first time to my knowledge that we have had to process a claim like this."

In most cases, real estate brokers keep the security deposits, which assures buyers of getting their money back, Pugh said.

However, Pugh said there probably are many builders in Maryland who don't comply with any of the three options for security deposits. "Since builders are not licensed, we have no way of knowing much about them," he said.

Similarly, it's just as difficult for prospective homeowners to find unbiased and accurate information about builders. For example, the National Association of Home Builders, the industry's trade group, does not hand out referrals for legal liability reasons.

William Young, director of consumer affairs for NAHB, said that prospective home buyers should attempt to research a builder's history before making a down payment.

"The first things builders cut back on is service to existing customers; it's an important tip-off" about the financial health of a builder, Young said. He suggested that prospective home buyers find a development their builder has recently finished and ask residents there if they have seen any slowdown in service.

Meanwhile, Eltawila is seeking finishing touches on his home. "Eight thousand dollars worth of work needs to be done on my unit, from hardwood floors that need to be sanded to plumbing problems," Eltawila said.

"It is a really annoying situation. We don't have most of our stuff put out, and we still have things in boxes even though we've been living here for six months," he added.

So, for the foreseeable future, Eltawila and the handful of residents of the Villas are waiting for the promise of Capital Sun's promotional folder:

"With every home we build, we are also building our reputation -- so from the sales office to the carpenter, we take carefully planned procedures to ensure that the home you buy is 100 percent before you move in. That kind of dedication to delivering the best built and designed homes available shows ... . We hope you will see and appreciate the difference our care and planning makes."