There are a lot of issues that come up in the State Capitol, and, where the significant legislation is concerned, you can usually see a breakdown occurring on partisan lines. This is because there are distinct differences between the philosophies of the parties, and when bills seek in increase the size and scope of the government, Democrats support them and Republicans oppose them. Similarly, when legislation shrinks government, it is often hard to get a Democrat to support it. There are some pieces of legislation, though that will divide Democrats or Republicans, and clearly Senate Bill 670 authored by State Senator Lou Correa (D-Santa Ana), and advocated by state realtors, is one of those bills.
Senator Correa’s bill seek to ban a type of ‘transfer cost’ that is starting to become more prevalent in home sales. The very short version of what happens is this — a home builder places this transfer cost (or fee) on the original deed, requiring that some small percentage of the purchase price (typically one percent or less) be paid to the builder at the time of sale, and perhaps what is most unusual, and disturbing to most, is that because it is imbedded in the deed, every time in the future that the home is sold, the original developer continues to get that fee.
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April 16th, 2007 at 12:00 am
Jon,
Didn’t we get into this mess of reconveyance fees because local jurisdictions request an arm and a leg from developers for all kind of mitigation? It’s just easier for developers to pass this along to the home buyers rather than fight “city hall”.
Marcia Gilchrist