Following the lead of many other states and the federal government, a bill restricting Residential Real Property Transfer Fee Covenants, SB 11-234, was introduced Thursday in the Senate.
The bill as introduced does not limit transfer fees paid to community associations of any kind. Also excluded from the bill’s limitations are transfer fees payable to (among others):
- property management companies, real estate brokers, title companies, mortgage brokers and other professionals arising out of the sale of the property
- certain charitable organizations for the purpose of benefiting the community
- governmental or quasi-governmental entities, including bonds
As we reported in our April 6, 2011 blog, the federal government is also currently moving to limit transfer fees payable only to investors and others with no connection to the property or the community. Fortunately, the Colorado transfer fee bill differs from the proposed FHFA regulations – the Colorado bill does not restrict how HOAs may use the money they receive in transfer fees.
We’ll provide more information about the transfer fee bill and keep you informed of its progress in the legislature.