Bill Text: HI SB2373 | 2010 | Regular Session | Amended
Bill Title: Real Property; Transfer Fees
Spectrum: Partisan Bill (Democrat 6-0)
Status: (Engrossed - Dead) 2010-03-04 - (H) Referred to WLO, CPC, JUD, referral sheet 37 [SB2373 Detail]
Download: Hawaii-2010-SB2373-Amended.html
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THE SENATE |
S.B. NO. |
2373 |
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TWENTY-FIFTH LEGISLATURE, 2010 |
S.D. 2 |
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STATE OF HAWAII |
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A BILL FOR AN ACT
RELATING TO PRIVATE TRANSFER FEES.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
SECTION 1. Chapter 501, Hawaii Revised Statutes, is amended by adding a new section to the part entitled "Miscellaneous Provisions" to be appropriately designated and to read as follows:
"§501- Prohibition of transfer fees. (a) A deed restriction or other covenant running with the land applicable to the transfer of real property that requires a transferee of real property or the transferee's heirs, successors, or assigns to pay a fee in connection with a future transfer of the property to a declarant or other person imposing the deed restriction or covenant on the property or a third party designated by a transferor of the property is prohibited. A deed restriction or other covenant running with the land that violates this section or a lien purporting to encumber the land to secure a right under a deed restriction or other covenant running with the land that violates this section is void and unenforceable.
(b) This section shall not apply to the following fees or charges required by a deed restriction or other covenant running with the land in connection with the transfer of real property:
(1) Any interest, charge, fee, or other amount payable by a borrower to a lender pursuant to a loan secured by real property, including any fee payable to the lender for consenting to an assumption of the loan or transfer of the real property, for providing an estoppel letter or certificate, or for any shared appreciation interest or profit participation or other consideration payable to the lender in connection with the loan;
(2) Any fee, charge, assessment, or fine payable to condominium associations as defined by chapter 514A or chapter 514B, cooperative housing corporations as defined by chapter 421I or chapter 421H, and planned community associations as defined by chapter 421J, pursuant to a declaration, covenant, or law applicable to an association, including a fee or charge to change the association's records as to the owner of the real property or to provide an estoppel letter or certificate;
(3) Any fee or charge payable to a lessor under a lease of real property, including a fee or charge payable to the lessor for consenting to an assignment of the lease, for providing an estoppel letter or certificate, or to change the lessor's records as to the holder of the lessee's interest in the lease;
(4) Any consideration payable to the holder of an option to purchase an interest in real property or the holder of a right of first refusal or first offer to purchase an interest in real property for waiving, releasing, or not exercising the option or right upon transfer of the real property to another person;
(5) Any fee, charge, shared appreciation interest, profit participation, or other consideration, payable by:
(A) A person engaged in the business of the development of real property for resale to others and not for the person's own use or the use of the person's parent, affiliates, subsidiaries, or relatives;
(B) A person who acquires real property for the purpose of engaging in the business of the development of real property for resale to others or for the purpose of reselling the real property to a person engaged in the business of the development of real property for resale to others; or
(C) A person who purchases real property initially transferred at a price below the then prevailing market value of the real property pursuant to an affordable housing program established by the seller;
(6) Any fee or charge payable to a government entity; or
(7) Any fee, charge, or assessment payable pursuant to a deed restriction or other covenant running with the land that was required by a litigation settlement that was approved by the court before the effective date of this section.
(c) A deed restriction or other covenant running with the land filed in the office of the assistant registrar on or after the effective date of this Act, or any lien to the extent that it purports to secure the payment of a transfer fee prohibited by this section, shall not be binding on or enforceable against the subject real property or any subsequent owner, purchaser, or mortgagee of any interest in the real property. This subsection shall not be construed to imply that any particular deed restriction, covenant running with the land, or lien filed prior to the effective date of this Act is valid per se.
(d) No person shall be entitled to recover from the recipient or payee any fee, charge, or assessment required by a deed restriction or other covenant running with the land in connection with the transfer of real property to the extent that the fee, charge, or assessment was paid prior to the effective date of this Act."
SECTION 2. Chapter 502, Hawaii Revised Statutes, is amended by adding a new section to the part entitled "Other Provisions" to be appropriately designated and to read as follows:
"§502- Prohibition of transfer fees. (a) A deed restriction or other covenant running with the land applicable to the transfer of real property that requires a transferee of real property or the transferee's heirs, successors, or assigns to pay a fee in connection with a future transfer of the property to a declarant or other person imposing the deed restriction or covenant on the property or a third party designated by a transferor of the property is prohibited. A deed restriction or other covenant running with the land that violates this section or a lien purporting to encumber the land to secure a right under a deed restriction or other covenant running with the land that violates this section is void and unenforceable.
(b) This section shall not apply to the following fees or charges required by a deed restriction or other covenant running with the land in connection with the transfer of real property:
(1) Any interest, charge, fee, or other amount payable by a borrower to a lender pursuant to a loan secured by real property, including any fee payable to the lender for consenting to an assumption of the loan or transfer of the real property, for providing an estoppel letter or certificate, or for any shared appreciation interest or profit participation or other consideration payable to the lender in connection with the loan;
(2) Any fee, charge, assessment, or fine payable to condominium associations as defined by chapter 514A or chapter 514B, cooperative housing corporations as defined by chapter 421I or chapter 421H, and planned community associations as defined by chapter 421J, pursuant to a declaration, covenant, or law applicable to an association, including a fee or charge to change the association's records as to the owner of the real property or to provide an estoppel letter or certificate;
(3) Any fee or charge payable to a lessor under a lease of real property, including a fee or charge payable to the lessor for consenting to an assignment of the lease, for providing an estoppel letter or certificate, or to change the lessor's records as to the holder of the lessee's interest in the lease;
(4) Any consideration payable to the holder of an option to purchase an interest in real property or the holder of a right of first refusal or first offer to purchase an interest in real property for waiving, releasing, or not exercising the option or right upon transfer of the real property to another person;
(5) Any fee, charge, shared appreciation interest, profit participation, or other consideration, payable by:
(A) A person engaged in the business of the development of real property for resale to others and not for the person's own use or the use of the person's parent, affiliates, subsidiaries, or relatives;
(B) A person who acquires real property for the purpose of engaging in the business of the development of real property for resale to others or for the purpose of reselling the real property to a person engaged in the business of the development of real property for resale to others; or
(C) A person who purchases real property initially transferred at a price below the then prevailing market value of the real property pursuant to an affordable housing program established by the seller;
(6) Any fee or charge payable to a government entity; or
(7) Any fee, charge, or assessment payable pursuant to a deed restriction or other covenant running with the land that was required by a litigation settlement that was approved by the court before the effective date of this section.
(c) A deed restriction or other covenant running with the land recorded on or after the effective date of this Act, or any lien to the extent that it purports to secure the payment of a transfer fee prohibited by this section, shall not be binding on or enforceable against the subject real property or any subsequent owner, purchaser, or mortgagee of any interest in the real property. This subsection shall not be construed to imply that any particular deed restriction, covenant running with the land, or lien filed prior to the effective date of this Act is valid per se.
(d) No person shall be entitled to recover from the recipient or payee any fee, charge, or assessment required by a deed restriction or other covenant running with the land in connection with the transfer of real property to the extent that the fee, charge, or assessment was paid prior to the effective date of this Act."
SECTION 3. New statutory material is underscored.
SECTION 4. This Act shall take effect on July 1, 2050.
Report Title:
Real Property; Transfer Fees
Description:
Prohibits the imposition of fees for a future transfer of real property. Specifies exceptions. Eff 7/1/2050. (SD2)
The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.
