Legislative Link, March 23, 2013

Legislative Link, March 23, 2013

Bill to Prevent Private Transfer Fees Moves to Senate Rules Committee
GAR has taken a strong position to support the prohibition of private transfer fees in Georgia and is working hard for the passage of HB 160. HB 160 cleared Committee this week and is now available for the Senate Rules Committee. This bill would prohibit private transfer fees that developers might charge on subsequent transactions of real property and provide protections for future purchasers. With the assistance of NAR, over 40 states have banned the use of private transfer fees. GAR is supported in this effort by the Real Estate Section of the Georgia BAR Association and the Georgia Land Title Association. A private transfer fee is a charge that is required to be paid to a developer or individual at closing each time a property is sold. The fees range in amount but have been as high as 1 percent of the original mortgage amount. The transfer fee is attached to the property as a covenant and usually runs for a set period, often 20 or 99 years. While developers say it is a way to spread improvement costs over a longer period, opponents believe private transfer fees decrease affordability, increase potential liability, and provide no benefit to property purchasers within that community.

Lien Law Bill Moves Forward in Senate
Another 2013 Legislative Priority that has passed the Senate Judiciary Committee and is now available for the Senate Rules Committee is HB 434. This bill is in response to a Court of Appeals decision that limited what expenses can be included in a materialman's lien. This would permit them to receive not only the cost of their labor but also the expense amounts for materials. Originally the Court ruled that a contractor or subcontractor's General Condition Costs were not lienable items. According to this ruling, lienable items are only those that are fixed to the real estate. GAR will continue to support this bill, which returns lien law to it's original form and the traditional long standing practice of lien law in Georgia.

NAR Successfully Extends Rural Housing Funding Programs
Rural Americans rely on Rural Housing Service programs like the 502 Rural Housing Guaranteed Loan Program to provide them with services that can be difficult to come by in some communities. This program is instrumental in providing mortgage financing in small but growing communities. NAR released a Call for Action late last year to support the extension of the RHS programs. Included in a Continuing Resolution that just passed the U.S. House, and previously passed the U.S. Senate, is a provision grandfathering existing rural communities through September 30, 2013. Roughly 900 communities across the country would have lost access to affordable mortgages including the following in Georgia: Cusetta, Monroe, Villa Rica and Winder. NAR will continue to work on a more permanent solution to provide thousands of American families access to safe and affordable mortgages.

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