Investigation: Real estate company accused of deceptive practices


PHILADELPHIA (WPVI) — A local real estate company is under fire, accused of deceptive practices.

Data pulled from Philadelphia records suggests the company may be focusing on minority neighborhoods.

Rosetta Loper Grant, who is selling her Oxford Circle home, signed onto the agreement offered by MV Realty.

Grant is obligated to use MV Realty as her listing agent after signing on with the realtors’ Homeowner Benefit Program in March. MV Realty paid her $645 for initial exclusive rights for the opportunity to sell her property for 40 years.

But then in May, Loper Grant started second-guessing her decision.

“I started feeling a little leery,” she said.

That is when the City of Philadelphia notified her a mortgage had been recorded on her property.

“I didn’t see anything in there about my mortgage at the time whereas they will have a lien,” she said.

Kerry Smith is an attorney for Community Legal Services, which does pro bono work for low-income residents. She says a half dozen people have come to her seeking help after learning MV Realty recorded mortgages on their properties to secure their commission rights.

“Our clients are telling us they feel deceived,” said Smith.

Smith is critical of MV’s contracts, citing the 40-year term, 3% termination fee of the home’s values, and the forfeiting of customers’ rights to sue while MV Realty still can.

She also takes issue with what could happen to homeowners who pass along their property to heirs.

“If they choose to sell it to a family member or sell it on their own 10, 20, 30 years from now, they’re going to be on the hook for paying the company thousands of dollars,” said Smith.

The Action News Investigative Team dug into Philadelphia property records. MV Realty has recorded more than 500 mortgages in just two years.

We showed up on some homeowners’ doorsteps who said they had no idea.

“Did you know they were recording a mortgage against your property?” asked Action New investigator reporter Chad Pradelli.

“No, that’s when I told you I got some paperwork and I was like, ‘whoa…no,'” said Charles Spence.

Latrelle Fields-Fuller was equally shocked.

“Did they explain the contract in detail that a mortgage would be recorded?” asked Pradelli.

“Not a mortgage would be recorded but explained the contract real quick, fast in a hurry,” Fields-Fuller said.

The Florida-based MV Realty denies wrongdoing and told Action News its practices are not deceptive and all terms are clearly spelled out to customers.

Recent contracts we reviewed clearly state MV Realty will record mortgages to secure the exclusive listing rights and take what is generally a 3% percent sales commission.

“We have several clients who have been sued by MV Realty when they used another realtor to list their home,” said Smith.

Last week, the Florida Attorney General sued MV Realty, accusing it of “engaging in a complex and deceptive scheme with the goal of swindling consumers out of their home equity.”

The lawsuit also takes issue with what it states is abusive telemarketing and advertising practices. MV Realty told Action News their practices are legal and ethical.

“These are complicated agreements,” said Ira Goldstein.

Goldstein works for the nonprofit, Reinvestment Fund, which helps underserved communities.

He mapped out the MV Realty mortgages in Philadelphia and Delaware County and found most were in Black and brown communities with 69% of MV mortgages in the city recorded on Black-owned homes.

“Whether or not it’s an explicit ‘let’s target Black people or black neighborhoods,’ that I can’t tell you, but what I can tell you is in the outcome, it comes out that way.”

The Pennsylvania Attorney General’s Office is strongly encouraging people with complaints to report them to the office.

A spokesperson for Philadelphia City Council says it will holding hearings to address concerns on December 14.

Read MV Realty’s statement released to Action News:

“Recently, our Company became aware of a complaint filed by the Florida Attorney General. Our attorneys are currently reviewing it. We are confident that after a full airing of the facts, the Florida Attorney General will find that MV Realty’s business transactions are legal and ethical and that our team has operated in full compliance with the law. We look forward to and are fully committed to working with the FL Attorney General’s office to regulate these transactions.

Some background information is important to have.

The Homeowner Benefit Agreement (the “HBA”) is a straightforward agreement under which we pay homeowners a fee up-front for the right to be their real estate agent and earn a 3% commission if they decide to sell their home in the future. The point of the Homeowner Benefit Program is for a homeowner to give our firm the opportunity to list their home for sale in exchange for a cash…



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