To finance affordable housing projects, the California Legislature recently passed SB2, the "Atkins Building Homes and Jobs Act." This new law imposes a new $75 fee for every real estate instrument, paper, or notice required or permitted by law to be recorded, except those expressly exempted from payment of recording fees, per each single transaction per parcel of real property. However, this new fee does not apply to transfers subject to documentary transfer tax.
What does this mean for timeshare resale transactions? Well, for unrelated party transactions with no title issues, this fee will not apply since the deed used to transfer ownership is a transfer subject to documentary transfer tax.
However, for transactions where the seller needs to record certain documents to clear title (quitclaim deeds, affidavit of death of joint tenant, affidavit of death of beneficiary, etc.), the new $75 fee will apply for each recorded document, up to the maximum fee of $225 for 3 recorded documents. PLEASE NOTE that paragraph 6(c) of our standardized "Purchase Agreement and Escrow Instructions" states: "Seller shall exercise commercially reasonable due diligence to clear title and shall be responsible for the payment of all costs and claims arising out of or relating to the clearing of any defect of title." Thus, in timeshare resale transactions that we escrow using our forms, sellers will typically be responsible for paying the additional recording fees, if necessary, to clear title.
This new fee will also apply in instances of intra-family transfers of timeshare estates. For instance, last year we escrowed a transaction where a father transferred his ownership of a timeshare at the San Luis Bay Inn to his daughter. The new $75 fee would apply to this type of intra-family transaction.
The new fee will also apply to another common transaction we see - timeshare owners transferring their timeshare into their living trusts. If this is something you've been meaning to do, try and get it done before January 1st to avoid paying the extra $75 fee!
What does this mean for timeshare resale transactions? Well, for unrelated party transactions with no title issues, this fee will not apply since the deed used to transfer ownership is a transfer subject to documentary transfer tax.
However, for transactions where the seller needs to record certain documents to clear title (quitclaim deeds, affidavit of death of joint tenant, affidavit of death of beneficiary, etc.), the new $75 fee will apply for each recorded document, up to the maximum fee of $225 for 3 recorded documents. PLEASE NOTE that paragraph 6(c) of our standardized "Purchase Agreement and Escrow Instructions" states: "Seller shall exercise commercially reasonable due diligence to clear title and shall be responsible for the payment of all costs and claims arising out of or relating to the clearing of any defect of title." Thus, in timeshare resale transactions that we escrow using our forms, sellers will typically be responsible for paying the additional recording fees, if necessary, to clear title.
This new fee will also apply in instances of intra-family transfers of timeshare estates. For instance, last year we escrowed a transaction where a father transferred his ownership of a timeshare at the San Luis Bay Inn to his daughter. The new $75 fee would apply to this type of intra-family transaction.
The new fee will also apply to another common transaction we see - timeshare owners transferring their timeshare into their living trusts. If this is something you've been meaning to do, try and get it done before January 1st to avoid paying the extra $75 fee!
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