South Carolina Becomes 38th State to Restrict Private Transfer Fees
|February 21, 2012|
South Carolina Gov. Nikki Haley took swift action to protect South Carolina homeowners by signing HB 3095 to restrict Wall Street Home Resale Fees (also known as private transfer fees). The new law, sponsored by Rep. Alan Clemmons (R-Myrtle Beach), places a ban on these fees, a dangerous new financial scheme that steals home equity, lowers home resale values and adds another layer of difficulty to selling a home.
“These fees infringe on property rights and hurt South Carolina consumers,” said Representative Clemmons. “They have no place in the South Carolina real estate market. We’ve made sure that when a homeowner buys a new property, he or she owns that home free and clear.”
Manhattan-based Freehold Capitol Partners is leading the push to add these fees to home purchase contracts. The fees require that a percentage of the final sale price of a home be paid to a private third party every time the property is sold, typically for 99 years. Freehold is attempting to then sell the right to collect these fees on Wall Street—all the while padding investors’ pockets while stealing equity from homeowners.
“The Governor and Legislature stood up for homeowners by protecting consumers from these predatory fees,” said Teri Stomski, Palmetto Land Title Association President “This bill is an important step in enhancing consumer protections, safeguarding the real estate market and protecting our property rights system in South Carolina.”
South Carolina becomes the 38th state to have restricted the use of Wall Street Resale Fees.
The bill is the latest in a series of government actions to limit Wall Street Home Resale Fees. South Carolina joins Alabama, Arizona, Arkansas, California, Colorado, Delaware, Florida, Hawaii, Idaho, Illinois, Indiana, Iowa, Kansas, Louisiana, Maine, Maryland, Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska, Nevada, New Jersey, New York, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, South Dakota, Tennessee, Texas, Utah, Virginia and Washington in restricting the dangerous fees. On the federal level, the Federal Housing Finance Agency has issued a proposed rule that would prevent government-sponsored entities from investing in mortgages with these fees.