FCS Legislative Watch – Have You Heard about Senate Bill 391 That Seeks to Impose Additional Charge on Recorded Documents?
LegislationCA Senate Bill 391 Seeks to Impose $75 Additional Charge on Recorded Documents
First Corporate Solutions (FCS) wants to help raise awareness that a bill is now working its way through the California State Legislature that could prove costly to those in the public records, escrow, title, and lending communities.
If passed, CA Senate Bill 391 would enact the California Homes and Jobs Act of 2013 which seeks to raise funds for affordable housing in California by imposing a surcharge on many recorded documents within the state of California. According to the text of SB 391, “The bill would impose a fee, except as provided, of $75 to be paid at the time of the recording of every real estate instrument, paper, or notice required or permitted by law to be recorded.” The $75 per document increase would apply specifically to reconveyances, releases, assignments, fixture filings, refinance deeds of trust and all other recordable instruments that relate to non full-purchase real estate transactions. These documents number in the tens of millions statewide each year.
Read the full text of SB 391 here.
Many business and organizations that provide support services for real property transactions in California oppose SB 391. The following is an abbreviated version of a communication piece distributed by the California Escrow association detailing several of their opposition points:
- The bill would have a negative effect on borrowers attempting to refinance to a more favorable loans.
- The bill uses ambiguous language which makes it difficult to determine which documents, under what circumstances, would be subject to the new fees.
- The bill would serve as a disincentive for lien-holders to record reconveyenaces and releases that would clear title to an encumbrance that has been paid off. Additionally, individuals may elect to not file family trust and estate planning documents due to the higher cost associated with doing so.
FCS will continue to track SB391 and report any new developments here on the blog.