Thousands of Florida homeowners who were ensnared in controversial 40-year listing agreements with MV Realty are finally seeing those contracts terminated. This development follows a February court order and ongoing legal battles, bringing relief to many who felt trapped by the company’s deceptive practices.
Key Takeaways
- MV Realty is terminating thousands of "Homeowner Benefit Agreements" in Florida.
- These agreements, often lasting 40 years, granted MV Realty exclusive listing rights and allowed them to place liens on properties.
- The terminations are a result of a Hillsborough County judge’s order and a lawsuit filed by the Florida Attorney General.
- MV Realty’s license in Florida has been suspended, and the company is facing lawsuits in multiple states.
The MV Realty Controversy
MV Realty offered homeowners immediate cash payments, typically up to $5,000, in exchange for signing a "Homeowner Benefit Agreement." Unbeknownst to many, these agreements stipulated that MV Realty would have the exclusive right to list their homes for sale for a staggering 40 years. If a homeowner decided to sell with another brokerage, MV Realty would demand a fee equivalent to 3% of the property’s value to release the lien they had placed on the home.
This business model drew widespread criticism, with many attorneys general across the country labeling it as predatory and deceptive. The Florida Attorney General filed a lawsuit against MV Realty after reports of the scheme surfaced in 2022.
Legal Battles and Terminations
In February, Circuit Court Judge Darren D. Farfante ordered MV Realty to terminate all existing homeowner benefit agreements within 14 days. Initially, the company attempted to circumvent the order by merely changing contract language rather than outright terminating them. However, recent court filings indicate that MV Realty has begun to cancel these agreements, with over 1,000 contracts terminated in Hillsborough, Pinellas, and Pasco counties since March.
Charles Gallagher, a St. Petersburg attorney who has represented clients against MV Realty, described the terminations as a "super positive outcome" for homeowners, removing a "stain on the public record" that had prevented them from selling their properties or securing loans.
Impact and Future Outlook
While the terminations are a significant victory for homeowners, questions remain for those who already paid fees to MV Realty to escape their contracts. Legal experts suggest these individuals may now have a stronger case to sue for refunds, though MV Realty’s Chapter 11 bankruptcy filing in September 2023 could complicate repayment.
MV Realty’s license in Florida has been suspended, effectively ending its operations in the state. The company continues to face lawsuits in at least 11 other states, and its business model has been challenged nationwide, with some states capping such agreements at five years. The ongoing legal actions and widespread condemnation suggest that MV Realty’s controversial practices are nearing their end.
Sources
- Thousands of Florida homeowners scammed by MV Realty could soon get justice, Tampa Bay Times.
- Listing agreements terminated in Florida, RealEstateNews.com.