WASHINGTON D.C. — A realty company at the center of a Channel 11 news investigation is facing new scrutiny, this time from Congress.
Today, Ohio Senator Sherrod Brown, Chairman of the Senate Finance Committee and Senate Banking, Housing & Urban Affairs Committee sent a letter to the Federal Trade Commission and Consumer Financial Protection Bureau calling on the agencies to investigate the practice of exclusive real estate listing agreements used by companies like MV Realty.
The letter specifically references MV Realty and a series of investigative reports by Channel 11 and our Cox Media Group sister stations, which began reporting on the company in Orlando and Atlanta back in 2021.
As 11 Investigates reported exclusively over the past month, here in Pennsylvania more than 1200 homeowners were hit with 40-year liens on their property after entering into agreements with MV Realty.
The Florida based company offers homeowners quick cash now in exchange for an agreement to use the company later as their listing agent. But as our reporting exposed, many homeowners say they were misled and taken advantage of, because MV Realty never told them they would be locked into a 40-year commitment or that the company would place a lien on their property.
Just last week, Pennsylvania Attorney General Josh Shapiro filed suit against MV Realty saying the company “scams” consumers and is violating the state’s Unfair Trade Practices and Consumer Protection law. The AG’s office also cited our reporting for helping to expose the problem.
Cox Investigation Cited
In November, our Cox stations featured homeowners who regretted signing contracts with the company in Atlanta, Boston, Charlotte, Dayton, Jacksonville, Orlando, Pittsburgh, and Seattle - as well as a former company employee who said MV Realty used misleading and high-pressure sales tactics to target elderly and less sophisticated homeowners. The investigative teams collectively documented more than 12,000 properties in seven states with liens attached by MV Realty to document their contracts with homeowners.
“Recent reporting raises serious concerns about potentially predatory and coercive practices by real estate firms, like MV Realty, and several state attorneys general are taking action,” wrote the senators, citing a news story from WHIO-TV in Dayton, Ohio.
“I want to look more into it. Based on the report that Cox [Media Group] is doing, it’s essential,” said Senator Sherrod Brown (Ohio) in a previous interview with WHIO-TV. “When I see people taking advantage of homeowners or renters, we spring into action. And in cases like this, this is probably a prime area.”
In November, Florida’s attorney general filed a lawsuit against MV Realty, calling the company’s homeowner benefit program a deceptive scheme to swindle customers out of their home equity.
“For a company to prey on unsuspecting homeowners in a way that locks them into a 40-year obligation designed to siphon away equity from the property is disgraceful,” said Florida Attorney General Ashley Moody.
PA Attorney General Sues MV Realty
The Pennsylvania AG’s office says they have heard from homeowners across the state who say they were ripped off by the company.
“MV Realty is a scam that exploits Pennsylvanians in vulnerable financial situations, and my Office isn’t buying it. My Office will protect homeowners’ most important asset– the value of their real estate,” said Pennsylvania Attorney General Josh Shapiro.
Shapiro’s news release included a Pittsburgh-area resident who was interviewed by WPXI-TV during the original investigation.
“MV Realty did not represent themselves fairly in their dealings with my wife and me,” said Thomas Halapin. “I was unaware a mortgage was placed on my property until a news reporter showed up at my house the following morning. The terms we discussed with MV Realty never mentioned a mortgage, and they represented the agreement was for 10 years, not 40.”
Last week, in addition to Pennsylvania’s AG, the Massachusetts Attorney General also filed suit against the company.
Attorneys general in Georgia and North Carolina also confirmed they are investigating the company. A Washington state legislator recently held a hearing and drafted legislation aimed at curtailing the company’s business practices.
Concern over predatory practices
In the letter today, Senator Brown said the practices of companies like MV Realty raise serious concerns about potentially predatory and coercive tactics.
“We urge the CFPB and FTC to work with state attorneys general to review whether these listing agreements and business practices violate federal consumer protection laws, including prohibitions against unfair, deceptive, or abusive acts and practices, and to take appropriate action where violations are found,” wrote the senators.
MV Realty operates in 33 states and has acknowledged signing more than 30,000 homeowners across the country to contracts in exchange for payments ranging from a few hundred dollars to a few thousand dollars, depending on the value of their home.
Homeowners repeatedly told the investigative teams that they were unaware the contract would last for 40 years, include a lien on their property, and that they would owe between 3% and 6% of their home’s value to MV Realty if they listed it with another realtor. The company has filed lawsuits against homeowners it believes violated the contract, including cases where homes went into foreclosure, or a homeowner died and the property transferred to an heir.
“MV Realty, and companies like it, take tens of thousands of dollars from homeowners in exchange for a minimal up-front payment. By advertising these agreements as a “loan alternative,” companies are attempting to avoid the legal limitations on lending while in essence charging borrowers onerous rates,” wrote the senators, citing a news story from WSB-TV in Atlanta.
MV Realty has denied multiple requests for on-camera interviews but sent written statements defending its business model and denying any wrongdoing. “MV Realty has always been committed to transparency in all of our business transactions, and we are confident that any inquiry will confirm that our team has operated in full compliance with the law,” wrote a spokesperson.
See an MV Realty spokesperson’s provided statement in response below:
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