Our team does a great deal of business helping buyers and sellers with condos across the Metro Denver area. I’ve seen a lot of shady tricks pulled by HOA management companies, builders and other people involved in the real estate transaction, but this one is one of the worst. I’m not big on government regulation, but this is one time where I’, happy to see lawmakers step in.
It seems that some HOA communities were attempting to set up mandatory HOA transfer fees that must be paid on any sale of a home in the community. this transfer fee was to be paid to a 3rd party and wasto be paid on every transaction for 99 years from the date of construction. These fees were going to be securitized and sold to Wall Street.
Check out the story from the Summit County Citizen’s Voice:
Senate Bill 11-234 would ban private real estate transfer fees, which have been added to homeowner association covenants during the development phase to fund an investment scheme cooked up by Manhattan-based Freehold Capitol Partners.
The covenants are set up to require that a percentage of the sale price of a home be paid to a private 3d party every time the property is sold, typically for 99 years, explained Rachel Wolf, of the Land Title Association of Colorado. Freehold is attempting to bundle and securitize these fees, and sell them to Wall Street investors.
In a press release, Wolf said the fees steal home equity, lowers resale values and adds another layer of difficulty to selling a home.
Read the whole article.
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