Senator RONALD L. RICE
District 28 (Essex)
Senator DANA L. REDD
District 5 (Camden and Gloucester)
Exempts sales to homeowner assistance and recovery programs from realty transfer fees.
CURRENT VERSION OF TEXT
An Act concerning exemptions from realty transfer fees and amending P.L.1968, c.49.
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. Section 6 of P.L.1968, c.49 (C.46:15-10) is amended to read as follows:
6. The fee imposed by this act shall not apply to a deed:
(a) For a consideration, as defined in section 1(c), of less than $100.00;
(b) By or to the United States of America, this State, or any instrumentality, agency, or subdivision thereof;
(c) Solely in order to provide or release security for a debt or obligation;
(d) Which confirms or corrects a deed previously recorded;
(e) On a sale for delinquent taxes or assessments;
(f) On partition;
(g) By a receiver, trustee in bankruptcy or liquidation, or assignee for the benefit of creditors;
(h) Eligible to be recorded as an "ancient deed" pursuant to R.S.46:16-7;
(i) Acknowledged or proved on or before July 3, 1968;
(j) Between husband and wife, or parent and child;
(k) Conveying a cemetery lot or plot;
(l) In specific performance of a final judgment;
(m) Releasing a right of reversion;
(n) Previously recorded in another county and full realty transfer fee paid or accounted for, as evidenced by written instrument, attested by the grantee and acknowledged by the county recording officer of the county of such prior recording, specifying the county, book, page, date of prior recording, and amount of realty transfer fee previously paid;
(o) By an executor or administrator of a decedent to a devisee or heir to effect distribution of the decedent's estate in accordance with the provisions of the decedent's will or the intestate laws of this State;
(p) Recorded within 90 days following the entry of a divorce decree which dissolves the marriage between the grantor and grantee;
(q) Issued by a cooperative corporation, as part of a conversion of all of the assets of the cooperative corporation into a condominium, to a shareholder upon the surrender by the shareholder of all of the shareholder's stock in the cooperative corporation and the proprietary lease entitling the shareholder to exclusive occupancy of a portion of the property owned by the corporation;
(r) Recorded by a qualified purchaser operating a housing assistance and recovery program, which program is certified by the Commissioner of Community Affairs as meeting the following requirements:
(1) the purchaser is a not-for-profit entity that has established and registered a housing assistance and recovery program with the Commissioner of Community Affairs;
(2) the terms of a housing assistance purchase under the program includes a lease-back provision to permit the seller and the seller's family to continue living at the property at a rent affordable to that family for seven years; and
(3) the terms of a housing assistance purchase under the program includes a provision that property will be sold back to the seller, or a family member residing with the seller, within seven years, in order to maintain the exemption under this subsection.
If the property subject to the exemption under this subsection is sold or transferred to a person or entity other than the original seller or a family member residing with the seller, then the fee exemption under this subsection shall end, and an amount equal to twice the realty transfer fee shall be collected at the time of the subsequent sale or transfer.
(cf: P.L.1999, c.357, s.1)
2. (New section) The Director of the Division of Taxation shall promulgate an "affidavit of consideration" form containing a provision to indicate exempt sales and transfers under a housing assistance and recovery program certified by the Commissioner of Community Affairs.
3. This act shall take effect immediately.
This bill is intended to exempt certain sales of residential property to a purchaser operating as a housing assistance and recovery program (HARP) from the payment of realty transfer fees. Under a HARP, a not-for-profit entity, such as a church organization, partners with a bank to rescue homeowners in danger of foreclosure or eviction. The not-for-profit entity works with the mortgage holder to purchase the property and then leases the property back to the original homeowner at an affordable rent. The goal of the HARP is to help financially strengthen the homeowner within a seven-year period, and then resell the property back to that homeowner, or member of the family living with the homeowner. The purpose of the sale or transfer to the HARP is to stop foreclosure or eviction proceedings; therefore, it does not make sense to charge a realty transfer fee because the property will be returned to the seller. To discourage fraud, if the property is sold to someone other than the original seller, or a person residing with the seller, then an amount equal to twice the realty transfer fee would be collected at the time of that subsequent sale.