Private Transfer Fee (Sellers Real Property Disclosure Form)
Question #15 on the Nevada Seller’s Real Property Disclosure Form(SRPD)- “This property is subject to a Private Transfer Fee Obligation?”
What is a Private Transfer Fee? It is an encumbrance on the property, which shows up like a mortgage deed. It is a recurring fee paid back to the Seller, every time a sale occurs, in exchange for clear title. The Seller maintains a financial interest in the property for decades after it’s been sold, not with a mortgage or a loan but with a private transfer fee.
As of May 2011, in Nevada they are not legal. Per Nevada Assembly Bill 271
http://www.leg.state.nv.us/Session/76th2011/Bills/AB/AB271_EN.pdf
Nevada joined with more than half of the rest of the Country in banning private transfer fees on real estate– AB 271 makes all new private transfer fee obligations “void and unenforceable.”
If you have an “existing Private Transfer Fee” it remain legal, but the beneficiaries of currently recorded private transfer fee covenants are subjected to new recording and notice requirements to preserve their interest, including civil penalties for creation of new private transfer fee obligations or failure to comply with the recording requirements.
Question 15 of the Nevada Sellers Real Property Disclosure Statement (SRPD) asks if, “This property is subject to a Private Transfer Fee Obligation?”
Thus per the new SRPD, sellers of properties in Nevada with existing private transfer fee obligations must disclose this encumbrance.
This is a series of Disclosure Entries see also:
Nevada Disclosure In Residential Sales
An Updated All Inclusive & Belt Way Disclosure
The New, Improved All Inclusive Disclosure
Nevada Condominium Hotel Disclosure
Nevada S.R.P.D. New Clarification of Real Estate Disclosure Laws in Nevada
Any questions, you can call me Darren Welsh 702 245 1787.
November 5, 2011 at 1:08 pm
Hello Darren,
My name is Joseph Ruggeroli and I am with the Brian Wedewer Team. I have been reading about AB284 and the potential effects it may have on the supply of foreclosed homes on the market. Some believe that this will drastically shrink the inventory of resale homes available for purchase and the resulting shortage will cause a shortage. What is your take? Looking at the bill it seems reasonable that the requirements to file a Notice of Default should not be too onerous but compliance may cause a log jam and extend the recovery period for our housing market.
Thank you very much!
Joseph Ruggeroli
January 17, 2012 at 2:52 pm
I know private transfer fees don’t apply to CIC’s, but I still don’t really understand what one is and could not explain it to a client in layman’s terms at this point