AG Shapiro Sues Real Estate Brokerage Firm MV Realty Over Misleading Homeowner Benefit Program
Attorney General Josh Shapiro today announced a lawsuit against Florida-based MV Realty PBC, LLC and its founder, Amanda Zachman. The suit alleges that the defendants misled Pennsylvania consumers regarding the terms of the company’s so-called Homeowner Benefit Program and obtained mortgages on consumers’ homes without their knowledge.
The Homeowner Benefit Program currently offered by MV Realty scams consumers with a one-time upfront payment in exchange for the exclusive opportunity for MV to list the consumer’s home on the realty market if the consumer sells at any time in the next forty years. Consumers who try to withdraw from the program find themselves at risk for substantial penalties to be paid to MV Realty or they may be blindsided with a mortgage placed against their property.
“Pennsylvania homeowners are falling victim to MV Realty’s calculated deception in hiding the terms of the Homeowner Benefit Program,” said Attorney General Shapiro. “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.”
MV Realty’s telephone sales pitch misleadingly suggests that the Homeowner Benefit Program has no risk to homeowners because they pay nothing to MV Realty unless they sell their homes. When successful with its sales pitch, MV Realty then has consumers sign a Homeowner Benefit Agreement which contains terms that are wildly different from the simple deal MV Realty sells over the phone.
The agreement contains terms that are far outside the norm of the real estate industry. Most shockingly, the Homeowner Benefit Agreement permits MV Realty to obtain a mortgage on a homeowner’s real estate to enforce the contract’s terms. MV Realty does not advise consumers of these key terms in its sales pitches; rather, it just hides these terms in the fine print. The lawsuit alleges these unfair and deceptive practices by MV Realty are in violation of the Unfair Trade Practices and Consumer Protection Law.
“MV Realty did not represent themselves fairly in their dealings with my wife and me,” said Thomas Halapin, an MV Realty victim just outside of Pittsburgh. “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.”
The Office of Attorney General heard from homeowners across the Commonwealth claiming they were ripped off by MV Realty after learning that the company had recorded mortgages on their real estate without their knowledge. The Office is aware of around 1000 mortgages that are tied to MV Realty and believe there may be more throughout the Commonwealth.
These homeowners said that MV Realty misled them about the terms of the Homeowner Benefit Agreement and never told them that it would result in a mortgage being placed on their property. Homeowners have emphatically told the Office of Attorney General that they never would have signed MV Realty’s Homeowner Benefit Agreement had they known it involved a mortgage being recorded on their home.
The lawsuit asserts that defendants engaged in unfair and deceptive acts and practices in violation of the Unfair Trade Practices and Consumer Protection Law. The lawsuit requests the court order the defendants to:
- Pay restitution to all people who have suffered losses as a result of the defendants’ conduct;
- Strike all mortgages recorded on real estate in Pennsylvania;
- Refrain from entering into the Homeowner Benefit Agreement with Pennsylvania consumers; and
- Pay civil penalties of $1,000 for each violation of the Consumer Protection Law and $3,000 for each violation involving a consumer 60 or older.
Consumers with concerns about contracts they made with MV Realty are strongly encouraged to file a complaint with the Bureau of Consumer Protection online or contact BCP for more information at 1-800-441-2555 or firstname.lastname@example.org.