June 24, 2011

in Industry News,PLTA News

On Friday, June 24, 2011 Pennsylvania Governor Thomas Corbett signed into law House Bill 442, which will ban the practice of Private Transfer Fees (PTFs) throughout the Commonwealth. With this signing, Pennsylvania becomes the 36th state to have banned or restricted PTFs.

The Pennsylvania Land Title Association ®  (PLTA) has worked for many months to prohibit private transfer fees.  PLTA’s Board formed a special committee in early 2010 to investigate the impact of Private Transfer Fee Covenants on the transfer of real estate in Pennsylvania.  

Sen. Wayne Fontana (D-Allegheny) and Rep. Sue Helm (R-Dauphin) introduced legislation supported by PLTA to prohibit private transfer fees in the Commonwealth. The legislation also creates reporting and disclosure requirements on the administrators of the private transfer fees that already exist and if those requirements aren’t met, the PTF is null and void. The legislation garnered a large number of co-sponsors and was passed with close to a unanimous vote in both houses.

PLTA’s Immediate Past President, Diana Sabol, CLTP said, “This is a win for Pennsylvania consumers. These private transfer fee covenants could have cost home buyers thousands of dollars in additional closing fees and made it impossible for many to purchase a home.”  Sabol went on to say, “PLTA is grateful to both Sen. Fontana and Rep. Helm for their dedication to protecting the consumer and home ownership in Pennsylvania.”

PLTA’s PTF Committee Chair Paul Trefz, CLTP explains, “Private transfer fees are part of a covenant attached to the property deed that forces the seller to pay 1 percent of the purchase price to a private third-party entity every time the property sells over the next 99 years. These fees cost unsuspecting homeowners thousands of dollars in additional closing costs.” Current PLTA President Philip Janny, CLTP said, “PLTA is extremely proud of Immediate Past President Diana Sabol and Chairperson Paul Trefz for their leadership role with this important bill”.

PTFs are being fought by a national coalition of organizations called the Coalition to Stop Wall Street Home Resale Fees. PLTA worked on this legislation with the Pennsylvania Association of Realtors ®. The Coalition also includes the American Land Title Association, and the National Association of REALTORS® (NAR) .  In addition, the Consumers Union and the Consumer Federation of America recently announced that they have joined the Coalition.

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