Thousands of Florida homeowners ensnared in controversial 40-year listing agreements with MV Realty are finally seeing their contracts terminated. This development follows a Hillsborough County judge’s ruling and ongoing legal action by the Florida Attorney General, offering a significant victory for those who felt trapped by the company’s deceptive practices.
Key Takeaways
- MV Realty is terminating thousands of 40-year homeowner benefit agreements in Florida.
- The terminations follow a February court order and a lawsuit by the Florida Attorney General.
- The company’s license in Florida has been suspended, and it faces lawsuits in multiple states.
- Homeowners previously paid fees to exit contracts may have a strong legal argument for refunds.
MV Realty’s Controversial Business Model Unraveled
MV Realty’s "homeowner benefit agreements" offered homeowners a small upfront payment, typically up to $5,000, in exchange for exclusive rights to list their property for sale for 40 years. Many homeowners were reportedly unaware of the lengthy term or that the agreement allowed MV Realty to place a lien on their homes. Listing with another brokerage would incur a fee equivalent to 3% of the property’s value.
Legal Battles and Terminations
The Florida Attorney General sued MV Realty in 2022 over its deceptive practices. In February, a Hillsborough County judge ordered the company to terminate existing agreements within 14 days. While initial compliance was slow, with the Attorney General alleging the company merely altered contract language, MV Realty has now begun filing paperwork to terminate over 1,000 contracts in counties like Hillsborough, Pinellas, and Pasco.
Charles Gallagher, a St. Petersburg attorney representing affected homeowners, described the terminations as a "super positive outcome," removing a "stain on the public record" that hindered property sales and loan applications. The Florida Department of Business and Professional Regulation has also suspended MV Realty’s license, effectively ending its operations in the state.
Broader Impact and Future Outlook
MV Realty’s controversial model has drawn scrutiny nationwide, leading to lawsuits in at least 11 states. Colorado’s Attorney General is seeking to release all existing customers from their agreements, and Minnesota reached a settlement that included contract cancellations. In Washington state, similar agreements are now capped at five years.
While some homeowners paid fees to escape their contracts, it remains uncertain if they will receive refunds, especially given MV Realty’s Chapter 11 bankruptcy filing in September 2023. Despite the company’s continued operation in other states, legal experts believe this marks "the end of the line" for MV Realty in Florida, preventing further harm to homeowners.
Sources
- Thousands of Florida homeowners scammed by MV Realty could soon get justice, Tampa Bay Times.
- Listing agreements terminated in Florida, RealEstateNews.com.