I-TEAM: Real estate racket? Company offers homeowners quick cash in exchange for 40-year lien

It’s a check for few hundred dollars. But it comes with a 40-year real estate contract. That’s longer than most mortgages. And it could end up costing homeowners who sign up thousands of dollars down the road. It’s all part of a deal that some people say they’ve now come to regret.

The News Center 7 I-Team’s lead investigative reporter, John Bedell, is digging into how one realty company isn’t just tying up Miami Valley homeowners with 40-year listing agreements, they’re taking them to court to collect big fees.

For Charles Meredith, it started with a knock on the door at his home in Dayton. “It did sound like a pretty good deal,” Meredith told the I-Team. “They said they’re giving people $500 if we would think about letting them, when it came time to sell (the house), we would let them do the sale.”

In November 2021, Meredith signed a contract with Florida-based MV Realty for its “Homeowner Benefit Program.”

But Meredith now says, he did not understand what he was getting into when he signed the paperwork. “They didn’t say it was a contract type of thing,” Meredith said.

Then, this past May, Montgomery County court records the I-Team checked show MV Realty sued Meredith when he listed his home for sale. Court records show the company dismissed the lawsuit in June. The I-Team asked Meredith if this is all behind him now? “I believe it is,” he told us. “I haven’t heard nothing from them here lately.”

MV Realty gives homeowners money – $480 in Meredith’s case. In return, you either list your home with an MV Realty agent if and when you decide to sell your home or pay a penalty equal to 3% of the value of your house. The term of the deal is 40 years.

Bedell asked Montgomery County Recorder, Brandon McClain if he has ever heard of a 40-year exclusive listing agent agreement? “Never,” McClain said. “Traditionally, listing agreements that are exclusive, such as these, are going to be six months. … Generally speaking, someone enters into a listing agreement because they have made a decision, a family decision, to sell the property. And circumstances change. And obviously we know if things change from day-to-day, week-to-week, month-to-month, we could imagine the type of changes that could take place over the course of 40 years.”

Aside from serving as Montgomery County Recorder, McClain is also an attorney, a real estate agent, and a former judge. “One thing I will say is that these agreements – I’m not going to make a determination about the legality of them,” McClain told the I-Team. “However, I do believe that they are irregular.”

News Center 7 and our Cox Media Group sister stations across the country have been working together on this nationwide investigation for months. We found MV Realty is doing business in 33 states, including Ohio.

The I-Team checked public records that show at least 600 homeowners in Butler, Cuyahoga, Clark, Franklin, Greene, Hamilton, Lucas, Miami, Stark, Summit, and Warren counties alone have signed agreements with MV Realty. That includes at least 146 homeowners here in the Miami Valley in Butler, Clark, Greene, Miami, Montgomery, and Warren Counties.

The contracts allow MV Realty to place a 40-year lien on properties. It’s a Real Estate deal that can follow you to your grave. Even if a customer dies, their heirs have 10 days to transfer the deal, or they may have to pay a penalty equal to 3% of the value of the home.

“These agreements are running with the property, not with the owners,” McClain said. Adding there are “certain encumbrances that run with the property, such as just as taxes do, such as a water bill. (This is the) same thing.”

On their web site, MV Realty includes “Frequently Asked Questions” about their “Homeowner Benefit Program.” One of the FAQs is, “Do you file a lien on my house?” The answer, according to MV Realty’s web site is: “No, we file a memorandum. The purpose of the memorandum is to serve public notice of the homeowner’s obligations under the HBP agreement.”

Those memorandums are filed with County Recorder Offices, just like McClain’s. “If it walks like a duck, quacks like a duck, it is a duck,” McClain told the I-Team. “There are times when individuals may have a document that they form or title as a memorandum, but it has the same legal validity of a lien.”

News Center 7 is hiding the identity of a former MV Realty employee who says her job was to cold call homeowners. “I worked for MV Reality based out of Florida,” she told us. “I felt like I was taking advantage of people. It’s horrible. I didn’t want to make calls anymore.”

Atlanta Legal Aid Society attorney, Dina Franch says the MV Realty contract itself seems intentionally confusing. “It really is unconscionable and it’s a very lopsided contract by a sophisticated company against unsophisticated homeowners,” Franch said.

MV Realty refused our request for an on-camera interview, but told us in response to written questions, “We make sure that homeowners clearly understand the terms of the agreements before signing.” MV Realty also maintained, “We do not cold call. We only reach out to prospects who have opted-in to receive information from us.”

But News Center 7 got a hold of MV Realty’s own internal training materials, and they tell a different story. On one slide, MV Realty’s document says, “At some point, these homeowners went online and filled out a form requesting some form of financial assistance,” and “MV purchased these leads from various sources.”

“It was a cold call to these people, and they were unsuspecting,” that former MV Realty employee told us.

During his interview with the I-Team, Montgomery County Recorder Brandon McClain offered this piece of advice for Miami Valley consumers and homeowners: “I would just encourage each and every person who is thinking about entering into one of these agreements to make sure that they are 100% clear on what their rights, responsibilities, duties, and obligations are, because this company certainly knows what theirs is.”

According to the contract for its “Homeowner Benefit Program,” all MV Realty customers can cancel their deal within a three-day rescission window that all customers are offered.

Back where it all started at Charles Meredith’s home in Dayton, he offered this advice after dealing with MV Realty himself: “Stay away from them,” Meredith said while perched on a bench on his front porch. “I think they’re crooks.”

This nationwide investigation by the News Center 7 I-Team and our sister stations in seven other cities discovered State Attorneys General in Florida, Georgia, and North Carolina have opened investigations into MV Realty’s business practices. The I-Team reached out to Ohio Attorney General’s Office. A spokeswoman for the division of the AG’s Office that handles consumer protection said they have not gotten any consumer complaints involving MV Realty. That spokesperson added they “can neither confirm nor deny the existence of or potential for any investigation.”

Again, MV Realty declined the I-Team’s request for an on-camera interview through a spokeswoman who said in an email, “Given the complexity of this issue, and our concern that short sound bites may not provide the clarity the issue deserves, we prefer to provide the company’s responses in writing.”

Here is the entire written statement MV Realty sent to the I-Team: “We do enforce our agreements when homeowners violate their contracts. But we make sure that homeowners clearly understand the terms of the agreements before signing. Our licensed agents and brokers walk homeowners through the contracts. These realtors are bound by a professional code of ethics, and they have undergone a rigorous training program that covers every aspect of the contract and teaches them how to explain it in plain English to signatories. We also give the homeowners the option to rescind the agreement within three days of signing for any reason whatsoever. Each client is left a leave-behind one-page document with an over view [sic] of the important parts of the contract they have already signed … that states the 3 (-day) rescission period, the length of the contract, as well as contact information. They must sign the leave behind as well, acknowledging they understand the agreement they have made with MV Realty.”