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Transfer Fee Bans - Indiana

IC 32-21-14

Chapter 14. Transfer Fee Covenants

IC 32-21-14-1

"Transfer"

Sec. 1. As used in this chapter, "transfer" means the transfer of aninterest in real property located in Indiana by:(1) sale;(2) gift;(3) conveyance;(4) assignment;(5) inheritance; or(6) other means of transfer.

As added by P.L.136-2011, SEC.1. Amended by P.L.6-2012,SEC.207.

IC 32-21-14-2

"Transfer fee"

Sec. 2. (a) As used in this chapter, "transfer fee" means a fee orcharge that:

(1) is required under a transfer fee covenant; and

(2) is payable:

(A) upon the transfer of an interest in real property; or

(B) for the right to make or accept a transfer of an interest inreal property;regardless of whether the fee or charge is in a fixed amount or isdetermined as a percentage of the value of the property, of thepurchase price of the property, or of any consideration given for thetransfer of the property.

(b) The term does not include any of the following:

(1) Any consideration payable by the transferee to the transferorfor the interest in the real property being transferred, includingany consideration payable for a separate mineral estate and itsappurtenant surface access rights.

(2) Any commission to a real estate broker licensed under IC 25-34.1 payable:

(A) in connection with the transfer of an interest in realproperty; and

(B) under an agreement between the real estate broker andthe transferor or transferee.

(3) Any interest, charges, fees, or other amounts payable by aborrower to a lender under a loan secured by a mortgage againstan interest in real property, including the following:

(A) Any fee payable to the lender for consenting to anassumption of the loan or to a transfer of the property interestsubject to the mortgage.

(B) Any fees or charges payable to the lender for estoppelletters or certificates.(C) Any other consideration allowed by law and payable tothe lender in connection with the loan.

(4) Any rent, reimbursement, charge, fee, or other amountpayable by a lessee to a lessor under a lease, including any feepayable to the lessor for consenting to an assignment, subletting,encumbrance, or transfer of the lease.

(5) Any consideration payable to the holder of:

(A) an option to purchase an interest in real property; or

(B) a right of first refusal or first offer to purchase an interestin real property; for waiving, releasing, or not exercising the option or right uponthe transfer of the property interest to another person.

(6) Any tax, fee, charge, assessment, fine, or other amountpayable to or imposed by a governmental entity.

(7) Any fee, charge, assessment, fine, or other amount payableto:

(A) a homeowners association;

(B) a condominium association;

(C) a cooperative association;

(D) a mobile home association;

(E) another property owners association; or

(F) an agent representing an association described in clauses(A) through (E);under a covenant, law, or contract applicable to the association.

As added by P.L.136-2011, SEC.1. Amended by P.L.6-2012,SEC.208; P.L.127-2012, SEC.48.

IC 32-21-14-3

"Transfer fee covenant"

Sec. 3. As used in this chapter, "transfer fee covenant" means adeclaration or covenant, however denominated and regardless ofwhether it is recorded, that:

(1) purports to affect an interest in real property located inIndiana; and

(2) requires or purports to require the payment of a transfer fee to:

(A) the declarant;

(B) another person specified in the declaration or covenant;or

(C) the successors or assigns of a person described in clause (A) or (B);upon a subsequent transfer of the interest in real property.

As added by P.L.136-2011, SEC.1.

IC 32-21-14-4

Transfer fee covenants; not binding or enforceable; lien to secure payment void and unenforceable; no presumption of validity

Sec. 4. (a) A transfer fee covenant recorded in Indiana after June30, 2011:

(1) does not run with the title of the interest in real property thetransfer fee covenant purports to affect; and

(2) is not binding or enforceable at law or in equity, as an equitable servitude or otherwise, against any subsequent owner,purchaser, or mortgagee of the interest in the real property thetransfer fee covenant purports to affect.

(b) Any lien purporting to secure the payment of a transfer feepayable under a transfer fee covenant recorded in Indiana after June 30, 2011, is void and unenforceable.

(c) A:(1) transfer fee covenant; or

(2) lien purporting to secure the payment of a transfer feepayable under a transfer fee covenant ;recorded in Indiana before July 1, 2011, is not presumed to be validand enforceable.

As added by P.L.136-2011, SEC.1.

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