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In an effort to protect homeowners across the state, ""Ohio Gov. Ted Strickland"":http://governor.ohio.gov/ recently signed House Bill (HB) 292, which places a ban on Wall Street Home Resale Fees, also known as ""private transfer fee covenants.""
[IMAGE]The ""American Land Title Association"":http://www.alta.org/ (ALTA) praised Gov. Strickland for taking such swift action to sign this bill. The Washington, D.C.-based trade association said it has worked with several organizations to fight this dangerous scheme that steals home equity, lowers home resale values, and adds another layer of difficulty to selling a home.
""Gov. Strickland stood up for Ohio homeowners by outlawing Wall Street Home Resale Fees,"" said Kurt Pfotenhauer, CEO of ALTA. ""There was a broad coalition of organizations â€" including the Ohio Land Title Association, Ohio State Bar Association, Ohio Association of Realtors, and Ohio Bankers League â€" who saw the danger this hidden financial burden places on homebuyers. ALTA is stressing the importance of organizations taking quick action to protect homebuyers.""
ALTA said developers, in consultation with Wall Street advisers, are attempting to add languages to home purchase contracts requiring that a percentage of the sales price be paid to the original corporate owner of a property every time the property is sold, typically for 99 years. The association explained that the right to collect these Wall Street Home Resale Fees would then be securitized and sold to enrich investors at the cost of stealing equity from consumers.
According to ALTA, the allowance of Wall Street Home Resale Fees would force homeowners to pay a large fee to sell their homes and also add a complicated legal roadblock to the home sale process. As a result, this controversial financial scheme is facing opposition across the country, ALTA said.
The association cited _Dow Jones Newswire_, which recently reported on the growing resistance to Wall Street Home Resale Fees. According to the article, Federal Housing Finance Agency acting director Ed DeMarco hinted at a congressional hearing last month that his agency might bar Fannie Mae and Freddie Mac from buying mortgages on homes with transfer fees attached. In addition, the article said the Federal Housing Administration has already confirmed that it won't insure mortgages with Wall Street Home Resale Fees.
State governments across the country have also recognized the danger of Wall Street Home Resale Fees, ALTA said. In fact, with the passage of HB 292, Ohio became the 12th state to have restricted the use of transfer fees. According to ALTA, three additional states have bills awaiting a governor's signature, and bills are pending in four other states.
