Missouri Sues Real Estate Firm for Filing Unfair Real Estate Fee Agreements

March 19, 2024

Missouri became the 10th state to sue MV Realty and certain affiliates for filing unfair real estate fee agreements in property records, known as Non-Title Recorded Agreements for Personal Services (NTRAPS).

According to the lawsuit filed by Missouri Attorney General Bailey, the brokerage's “Homeowner Benefit Program” preys upon homeowners, offering small cash gifts in exchange for decades-long contracts for the exclusive rights to sell the property. The lawsuit alleges MV Realty described the agreement over the phone to thousands of consumers, many of whom had registered their numbers on Missouri’s No Call list.

“As attorney general, I will enforce the laws as written and defend innocent Missourians from being ripped off,” Bailey said. “I’m proud of the work done by our Consumer Protection Unit to obtain justice for victims in this case. The attorney general’s office will continue to do everything in our power to protect Missourians from deceptive business practices.”

The petition asks the court to order that the liens be removed, to declare that the agreements are void and unenforceable, to provide restitution to consumers who have been charged unlawful cancellation penalties, and to order that MV Realty pay fines and penalties, including $213 million in penalties for calling homeowners on the No Call list.

Other states to sue MV Realty include Georgia, New Jersey, Florida, Massachusetts, Ohio, Pennsylvania, North Carolina, California and Indiana.

Last year, MV Realty filed for Chapter 11 bankruptcy protection in 34 states. On March 12, the U.S. trustee in the bankruptcy case argued MV Realty used the bankruptcy filing to stall state prosecutors who have filed lawsuits against the company.

The deadline for consumers who signed MV Realty’s Homeowner Benefit Agreements to file proofs of claims was extended until April 1, 2024.

In 2023, 16 states passed legislation protecting homeowners from the predatory practice of filing unfair real estate fee agreements in property records, including Alabama, California, Colorado, Florida, Georgia, Idaho, Iowa, Maryland, Maine, Nevada, North Carolina, North Dakota, Ohio, Tennessee and Washington.

Contact ALTA at 202-296-3671 or communications@alta.org.