ORLANDO, Fla. — A new and controversial offer to sell your home cost an Orange County woman $8,000 even though the real estate agency never sold her house.
The company offers cash to homeowners that agree to use the agency, if, and when, they decide to sell their homes.
But Action 9′s consumer investigator Todd Ulrich found the contract can be risky for some homeowners.
Eleanor Gardner expects to sell her home sooner than later. So, a very unusual offer from MV Realty caught her attention.
“People who want to sell but they’re not ready, but whenever they’re ready, they would represent you,” Gardner said.
She says a company agent came to her house and offered to pay her $800 to join its Homeowner Benefit Program. Gardner says the agent explained she could also collect $100 more for every person she referred. Then, her doorbell rang.
“There were two ladies, they were two notaries. He didn’t tell me anything was going to be notarized,” Gardner said.
According to Gardner, she signed three documents and was paid $1,000, giving MV Realty the exclusive right to sell her home someday.
But she says, for months, the company failed to send her a copy of the contract she signed. When she finally got it, Gardner says it included pages she never saw.
What really caught her by surprise was the contract lasted 40 years. She felt the company had not told her the whole story, so she called MV Realty, based in Delay Beach, to cancel. That’s when she heard about the cancellation fee.
“What were the terms of the cancellation?” Ulrich asked.
“$8,000 from me, if I cancel, they haven’t done a thing,” Gardner replied.
Feeling trapped, she contacted Action 9. Ulrich asked real estate attorney Karen Wonsetler to review the contract.
“If you have any buyer’s remorse, they are coming after you for thousands and thousands of dollars,” Wonsetler said.
Our expert says the document is legal but can be risky for some home sellers. Besides the 40-year contract, it forces the owner’s family to use MV Realty to sell the house, and if a homeowner decides to cancel the contract but doesn’t pay the cancellation fee, they could face collections.
“If a notary is knocking on the door when someone is saying I have a check for you, do not sign,” Wonsetler said.
MV Realty told Action 9 that Gardner called the company to sign up, and the terms were fully disclosed during the sale and in the contract. A manager said If Gardner decides not to sell her home, she can keep the cash, and if the company could not sell her home, she would be free to choose another company and she wouldn’t owe anything.
“I don’t want anything to do with those people,” Gardner said.
If you need a small loan, Wonsetler says there are far better options than a real estate contract for a future sale and licensed real estate agents will offer 6-month contract listings to sell your home and for standard sales; there are no upfront fees.
MV Realty Response:
1. MV Realty’s Homeowner Benefit Program, provides homeowners with a cash payment in exchange for the homeowner’s agreeing that, if the homeowner ever elects to sell his or her home during the term of the agreement, then the homeowner must enter into a separate listing agreement with MV Realty for the sale of that home.
2. The Homeowner Benefit Agreement signed by Ms. Gardener provides that, in the event she ever decides to sell her home, MV will receive a standard 3% commission and any cooperating broker will receive a 3% commission as well. These rates are standard in the industry.
3. The homeowner is never required to pay back the compensation she received when entering into the Homeowner Benefit agreement. In other words, even if the homeowner decides to never sell her home, the homeowner gets to keep the entire amounts paid to her.
4. All MV agents are licensed in the state where they operate, and MV uses the standard Realtors Association form for the listing agreement if the homeowner ever decides to sell the home. Significantly, the Homeowner Benefit agreement has been fully disclosed to Florida regulators.
5. MV Realty HBA contracts are not listing agreements, as stated before. MV uses the Homeowner Benefit Program as a way of establishing new customer relationships.
6. MV Realty and its agents have a 4.9 out of 5.0 average approval rating on Zillow.
7. As stated before, Homeowners who contract with MV have no obligation to sell their home at any time. Only in the event they (in their sole discretion) decide to sell their home, do they work with licensed, experienced, highly rated and reputable real estate agents.
8. Differently named, but identical programs have also been offered by REMAX, Coldwell Banker, Berkshire Hathaway Home Services and Keller Williams.
9. The HBA program is a win/win. If the homeowner ever decides to sell her home, and MV Realty is unable to do so, the homeowner can then use any other broker she chooses to sell the home and still owe nothing to MV Realty.
10.The only time a termination fee is owed to MV Realty is if the owner defaults or wants cancel the contract.
11.MV Realty did not knock on Ms. Gardner’s door. She submitted an inquiry to MV Realty, to which MV responded with a phone call. No one targeted her for solicitation.
12.Ms. Gardner received and kept $1,000 from MV Realty. She has not raised any dispute about the service we have provided or raising any claim that we have restricted her ability to do whatever she wants with her home. But it appears she now wants to cancel the contract now and keep the $1,000.
13.Ms. Gardener contacted us looking for cash and was told verbally and in writing that the HBA is a 40-year contract, which she agreed to. She has never disputed that what she was told is consistent with what is in the agreement.
14.After being paid by MV Realty, Ms. Gardener is attempting to use WFTV ABC Orlando’s consumer protection team to help her keep the money and wriggle out of a standard business contract she entered with MV Realty. This is not right.
15.The timing of the sending of her contract was slowed due to Covid-19 restrictions, wherein the MV Realty office was close for a period of time. Employees could not get to the office where her agreement was located. This created a backlog of agreements. There is, however, no dispute that Ms. Gardner has been aware of the agreement since it was signed by her and that she received and retained $1,000 from MV.
16.The facts are clear, MV Realty gives homeowners money to agree to use our highly rated, 4.8 stars on Zillow, reputable, licensed agents if they ever decide (at their sole discretion) to sell their home.
17.MV Realty is committed to excellence in service and maintenance of our high customer satisfaction ratings, compliant with Florida rules, regulations and laws that govern our business contracts and listing agreements. There is no allegation here to the contrary.
18.The HBA program business model is not unique to MV, and in fact, there are multiple patents filed and issued by the USPTO, codifying this identical or a similar marketing method.
Cox Media Group