Calder said, "We didn't have no money, and paying the $800 at the time was a good deal to us, and since I was not just going to sell. I thought, well, let's get some money and we don't have to worry about it." But she did have to worry about it. Just months after signing the agreement with MV Realty, she says money got even tighter. Calder said she had to sell her Garner home she's lived in for 23 years. She listed with an agent right around the corner from her home, Terrance Boykin and it went under contract.
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Boykin said, "My transaction coordinator did some research. She found out that this document was attached to the deed to the house."
The document, which MV Realty refers to as a memorandum is attached to the deed on any home they have a contract with, even if the homeowner doesn't use MV Realty to sell their home. What did this mean for Calder? Boykin explains, "They had to pay that three extra 3% at closing, which meant that seller was paying 6% commission, half to the buyer's agent half to the seller's agent, and an extra 3% to MV Realty."
In Calder's case, at closing, she says it meant she owed MV Realty more than $6,000. Calder adds, "They didn't do a thing. It was just we got the $800.00 and that was it." Remember that $800.00 is what MV Realty paid her in exchange for a forty-year listing agreement. "If I knew, no, to have pay $6000 in exchange, no, it was not worth it at all. Is terrible that we have to be tied up on some agreement like that," Calder added. When Troubleshooter Diane Wilson asked Calder why she didn't contact MV Realty to list her home for sale, she said, "You know at the time. I didn't even, we didn't even know where we had the paper. I was looking to be able to contact them, and I mean, I have no idea where we had it."
The MV Realty agreement got the attention of the NC Real Estate Commission. Legal Counsel for the NC Real Estate Commission Janet Thoren says, "It puts it in my opinion, at a point where we're questioning whether or not this is some sort of predatory lending."
Thoren says they're investigating MV Realty and its home benefit program for customers. "I think they don't fully understand the terms of the contract, and what that means, and at the time most of these people are desperate, and they are in need of some cash." Once customers sign the paperwork with MV Realty, Thoren says it acts as a lien on the property.
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She adds, "It's been treated being by a lien by the closing attorneys, as well as by the title insurance companies, and so that lien has to be satisfied before the property can be sold." A lien that is attached to the property owner for the next forty years.
"They are expecting people who have signed the agreement to come back to them down the road, and they are expecting somehow for the heirs or signs of these properties to come back to them, and there's just no way these people would know um if they're not the ones that signed the agreement. Even the ones that signed don't seem to know what they've signed," Thoren adds.
When looking at just Wake and Durham counties property records, MV Realty had or still has several memorandums on customer properties, more than 200 in Wake county and more than 90 in Durham. Thoren says when homeowners are offered money upfront in exchange for signing a contract, it's key to understand the terms and conditions of what you're signing. She says, "If you're getting free money, what you think is free money, you really need to take a hard look at what you're signing."
The NC Attorney General's office says it's also investigating MV Realty. Also, in July of 2022, the Better Business Bureau stated online its agency conducted an investigation and determined their BBB files contain a pattern of complaints from consumers that allege issues with contracts. Specifically, consumers allege the homeowner's advantage program contract is unfair and, in some cases not fully explained, according to the BBB, MV Realty worked with the BBB to improve its customer experience.
As for Calder, MV Realty provided a statement to us that said in part: "The homeowner benefit agreement is a straightforward concept. We paid Mrs. Calder for the right to be her agent, and earn a 3% commission. Only three short months later, she listed her home for sale with another agent, and that agent earned the commission. In a circumstance like this, the company is entitled to a termination fee equal to 3%. Mrs. Calder only incurred this cost because she chose to breach the agreement and list the home with another agent instead of listing with MV as she agreed. We are not aware of any reason why Mrs. Calder did not allow MV to list her home for sale which would allow MV to earn the 3% that it was entitled to. Ms. Calder has offered no explanation as to why she would accept the $800.00 and, 3 months later, not use MV as her real estate listing agent as she had promised."
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As for the memorandum lien MV Realty puts on the properties, the company says it, "Serves as a public notice of the homeowners' commitment to give MV the opportunity to represent them in the sale of their home. This is to protect MV in the event a homeowner attempts to sell their home without allowing MV the opportunity to be their agent."
When it comes to the complaints and investigations, a representative adds they work diligently to respond to any inquiries and, "The company has a strong ongoing commitment to consumer disclosures and is constantly adding to them. Some of these disclosures include but are not limited to, clear unambiguous language of the contract itself that includes the description of the 40-year term, the filing of the memorandum, and the termination fees and the circumstances when they would be due. The same disclosures are again emphasized in a single-page leave-behind document signed by the customer. Additionally, the company's website prominently displays these same key program features. As well as an extensive FAQ section."
When it comes to the forty-year Homeowner Benefit Agreement a representative says, "The point of the HBA is for someone to give our firm the opportunity to list their home for sale. While the agreement term is for 40 years, our opportunity to represent the seller is for only 6 months, after which time, if they can sell their home successfully at the same terms, they do not owe anything to MV."
The best advice before agreeing to any program or contract is not to get enticed with money, instead read thoroughly through all of the paperwork, terms, and conditions. If you don't understand it, hire an attorney to read over the paperwork, or get someone to help you.
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