What started with a Maryland mother complaining to the News4 I-Team could end with a major change to state law.
In December, the News4 I-Team showed how viewers like Tarshia Brown lost their entire down payment when they tried to buy a new home in Prince George’s County from one the nation’s largest homebuilders.
“He said, ‘You’re not getting your money back,’” Tarshia said about her experience. She lost $52,000 after she signed the standard, but complicated, contract, allowing the homebuilder to seize her down payment after she lost her financing.
The I-Team showed the contract to real estate attorney and former state Del. Aisha Braveboy, who represented the district where News4 viewers live. She said it’s not just the contract that’s problematic, it’s the actual law.
“This contract does not protect buyers,” she told the I-Team. “It does not protect consumers. It really is a problem because the seller gets to determine what happens at the end of the day.”
She said the contract should not be allowed in the state. State Sen. Anthony Muse agreed and said he’s also hearing complaints from his constituents.
Sen. Muse, who is married to NBC4 anchor Pat Lawson Muse, said he was outraged when the I-Team investigation found one company reported it brought in more than $125 million in seized down payments.
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“People in good faith, who didn't know, signed for this, thinking it was just a process for the American dream,” Muse said. “They were taken advantage of."
Muse is asking the Maryland attorney general to launch an investigation into what the I-Team found and introduced legislation to change how builders are allowed to sell new homes in Maryland.
"The provision says, 'Once I give my money to a company like this, if I do not get a loan that is reasonable with an interest rate that is reasonable and fits my economic condition, then I have to be given my money back.'"
He said the bill would make buying a new home similar to buying a previously owned home, where the buyer has a “mortgage contingency” and can get money back if their financing falls through, even after signing a contract.
Brown is expected to testify at the bill’s first major hearing Thursday in Annapolis. The I-Team reached out to homebuilders who could be impacted by the law. They said they’re not ready to comment yet.
Muse and Braveboy say you should always have a lawyer look at any home sale contract before signing anything.
"Most attorneys will review these contracts for $500 to $100, just to review the contract,” Braveboy explained. “But it will potentially save you hundreds of thousands at the end of the day."
