🏠 Stopping predatory real estate firms in their tracks
🏠 Efforts move forward to limit the length of exclusive listing deals
🏠 Some homeowners have no idea what they’re agreeing to

A plan is moving forward to protect New Jersey homeowners from predatory real estate companies.

Bill A4962 sponsored by Assemblyman Paul Moriarty, D-Gloucester, would prohibit licensed real estate brokers, salespeople, and broker-salespeople from entering into exclusive, extra-long-term real estate contracts.

He said this is an effort to stop real estate companies from using deceptive practices to market predatory loans that are disguised as real estate service agreements.

A long long-lasting deal

He said a company called MV Realty (based in Florida) as been seeking out homeowners in need in New Jersey and several other states and offering them a payment, usually in the $600 to $800 range, in exchange for an exclusive listing agreement.

“The contract is for 40 years and ties you up, and your heirs, for 40 years," he said.

nervous man
4774344sean, ThinkStock

He said what happens is years later some people forget they signed these agreements, or someone may pass away and leave the home to their heirs, but this company goes to your county clerk and puts a lien on your house.

“They basically take out a mortgage on your house so that if it ever changes to someone else’s name, they come forward and they want 6% of whatever the sale price was.”

Setting a reasonable limit

Moriarty said his legislation limits real estate contracts to five years “and also if there was some kind of payment to someone in return for a listing, they could buy themselves out of that 5-year contract by repaying the payment plus 6%”.

He said he decided to sponsor the measure after getting a call from the Gloucester County Clerk who told him at least 50 houses were under liens by this real estate company.

“As I looked into it I found out it was happening throughout New Jersey and people were not even aware they were signing a 40-year contract.”

He said it’s fine if somebody wants to sign an exclusive deal to sell their home but this is the use of deceptive practices “to target people that are in need of money, offering them a few hundred bucks in return for 40 years of being able to list their property, and to put a lien on that property.”

“It’s shocking and certainly not appropriate,” said Moriarty, “and we need to stop it.”

When MV Realty was asked for comment a spokesperson issued the following statement:

“We look forward to working with the NJ legislature as they explore future listing agreements to create comprehensive law that protects consumers by mandating transparent, easy-to-read contracts and prohibited practices that allow homeowners the option to participate in future listing programs.”

The measure has been passed by the Assembly and referred to the State Senate Commerce Committee for consideration.

David Matthau is a reporter for New Jersey 101.5. You can reach him at david.matthau@townsquaremedia.com

Click here to contact an editor about feedback or a correction for this story.

Up or down? Average property tax changes in NJ in 2022

Below are the average property tax bills for every municipality in New Jersey last year.

The towns are listed from the biggest cut in the average bill to the highest increase. On the county maps, the deeper red color means a higher increase above 2% whereas the darker green signifies a smaller increase or a reduction.

Each listing also shows how the average tax bill is split among the county, school and municipal governments.

Weird things NJ taxes - and some they don't

In general, New Jersey assesses a 6.625% Sales Tax on sales of most tangible personal property, specified digital products, and certain services unless specifically exempt under New Jersey law.
However, the way the sales tax is applied in New Jersey sometimes just doesn't make sense.
New Jersey puts out an itemized list for retailers that spells out what is, and what is not, taxed. 
Perhaps because this is New Jersey, there are some bizarre and seemingly contradictory listings. 

LOOK: Here is the richest town in each state

Just saying the names of these towns immediately conjures up images of grand mansions, luxury cars, and ritzy restaurants. Read on to see which town in your home state took the title of the richest location and which place had the highest median income in the country. Who knows—your hometown might even be on this list.

More From New Jersey 101.5 FM