Thousands of Florida homeowners ensnared in controversial 40-year listing agreements with MV Realty are finally seeing their contracts terminated. This development follows a February court order and ongoing legal battles against the company, accused of predatory and deceptive business practices that placed liens on properties and restricted homeowners’ ability to sell.
MV Realty’s Controversial Practices Unveiled
MV Realty’s "homeowner benefit agreements" offered homeowners a small upfront payment, often up to $5,000, in exchange for exclusive rights to list their homes for an astonishing 40 years. Many homeowners were reportedly unaware of the lengthy term or the clause allowing MV Realty to place a lien on their property if they attempted to sell with another brokerage. To escape these agreements, homeowners faced a hefty fee, typically 3% of their property’s value.
Legal Battles and Terminations
Following reports by the Tampa Bay Times in 2022, the Florida Attorney General initiated a lawsuit against MV Realty for deceptive business practices. In February, a Hillsborough County judge ordered the termination of existing homeowner benefit agreements within 14 days. While initial compliance was slow, with the Attorney General citing contract language changes instead of full terminations, MV Realty has now begun cancelling agreements. Since March, over 1,000 contracts have been terminated in Hillsborough, Pinellas, and Pasco counties alone.
Key Takeaways for Homeowners
- Freedom from Liens: The termination of these agreements removes a significant "stain on the public record," allowing homeowners to sell their properties or secure loans without MV Realty’s encumbrance.
- No Automatic Refunds: While the judge’s ruling mandates contract termination, it does not automatically entitle homeowners who previously paid fees to MV Realty for release to a refund. However, it strengthens their legal standing should they pursue a lawsuit for reimbursement.
- MV Realty’s Future in Florida: The Florida Department of Business and Professional Regulation has suspended MV Realty’s license, effectively ending its operations in the state. The Attorney General’s lawsuit is ongoing, with MV Realty attempting to dismiss claims of deceptive advertising.
Broader Impact and Industry Response
The controversy surrounding MV Realty has prompted action beyond Florida. The company, which filed for Chapter 11 bankruptcy in September 2023, faces lawsuits in at least 11 states and has had its license revoked in some, including Colorado. Other states, like Minnesota, have reached settlements with MV Realty to cancel these agreements, and Washington state has capped such agreements at five years. Attorneys like Matt Weidner, who first filed a complaint against MV Realty in 2021, express satisfaction with the outcome but criticize the company’s prolonged resistance, highlighting the need for stronger regulatory oversight in the real estate industry.
Sources
- Thousands of Florida homeowners scammed by MV Realty could soon get justice, Tampa Bay Times.
- Listing agreements terminated in Florida, RealEstateNews.com.