A state delegate plans to introduce legislation that would restrict predatory real estate practices, including the exclusive right-to-list agreements reported on by The Baltimore Banner this week.

Del. Marlon Amprey, a Baltimore Democrat, is drafting a bill to be introduced in early 2023 that would seek to protect homeowners from predatory realty and lending companies that Amprey says are siphoning generational wealth from homeowners — especially Black homeowners.

Because these companies are “really taking out our middle-class opportunities at wealth and taking out opportunities to build generational wealth, the state has to be involved in making sure that wealth access is available to people,” said Amprey.

“Baltimore really is the last affordable East Coast city,” added Amprey, arguing that his legislation would help keep it that way.

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Amprey’s bill would target both more prevalent predatory practices, such as reverse mortgages, as well as the agreements that hundreds of Maryland homeowners have signed in recent months with the real estate company MV Realty that grant the company the exclusive right to list their homes for 40 years in exchange for quick cash, in some cases a few hundred dollars.

The agreement is breakable only by paying a “termination fee” equal to 3% of the home value as estimated by the company.

Lawyers, real estate professionals, and consumer advocates have described the agreements as predatory and deceptive. In a statement this week, MV Realty spokeswoman Diana London wrote that “the terms are, in fact, written in plain English and always signed in the presence of a notary.” London said “only a tiny percentage of those homeowners have expressed confusion about our agreements.”

Amprey worries that such financial loss can be especially burdensome for older homeowners who are most vulnerable to deceptive real estate practices.

“Every thousand dollars is money for the food they need, the treatment they need,” said Amprey.

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MV Realty operates in 33 states and has secured 30,000 “homeowner benefit agreements” across the country. According to Sarah Mancini, an attorney at the National Consumer Law Center, regulators have begun to take notice, but this legislation would be the first she’s aware of to target the agreements.

“It’s encouraging to hear that lawmakers are focusing on the issues,” said Mancini. “As people do more investigating into the business model, it may be that there is a need for additional legislation, but it also seems that there are a number of existing laws that may be helpful here.”

The American Land Title Association, the national trade association for title insurance companies, aims to release a model bill restricting these types of agreements that states will be able to base their own legislation on.

“Consumers may not fully understand the implications and, the act of recording these agreements in property records can create a long-term barrier to the sale or refinancing of real estate,” wrote Megan Hernandez, a spokeswoman for the organization. “Efforts to enforce agreements executed without the consent or knowledge of a future homeowner are unfair and deceptive.”

Baltimore City Councilwoman Odette Ramos said she would propose that the council hold a hearing to discuss possible responses to the agreements and to raise awareness.

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“It’s new in Baltimore and I want more people to be aware of what this is and really to get in the habit of not signing stuff that you don’t understand,” Ramos said.

In a statement to The Banner, Joe Farren, a spokesman for the Maryland Real Estate Commission, wrote that while the business model “does not appear to conflict with existing law,” the commission “is not only tracking this issue, but actively seeking solutions.”

This story has been updated to include the American Land Title Association’s plans to release a model bill governing such agreements for states.


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