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Source of Title Blog

Positive Changes in Ohio's Budget Bill: Recording Fee Hike Nixed, and more...
by Robert Franco | 2017/06/28 |

Ohio House Bill 49, the FY 2018-2019 Operating Budget, is headed to the Governor's office with a couple of significant, and positive changes. As I blogged a couple of months ago, they tried to sneak a massive increase in recording fees into the budget bill - changing to a flat-fee structure. That entire proposal has been nixed. And, the Good Funds Law is getting a much needed update to increase cash and cashier check limits.  

Source of Title Blog ::

This was a close call. Both the increase in recording fees and the recent changes in the Good Funds Law would have certainly cost Ohio homeowner's more money.  It's good to see these items addressed.

As I wrote in The Ohio House Sneaks a Massive Recording Fee Increase into the New Budget Bill, the recording fees would have more than doubled the cost of recording some real estate documents.  A 2-page deed would have gone from $28.00 to $70.00. 


Obviously, this will make real estate transactions more expensive. For example, if a sale includes a 2-page deed, a 17-page first mortgage, a 2-page second mortgage (using the statutory form), a 2-page assignment of mortgage, and a 2-page release of the seller's mortgage, the total recording fees today would be $268.00 (including 2 marginal notations). Under the new fee structure it would cost $630.00 (with 2 references regarding a recorded instrument).

Thankfully, this was pulled from the budget bill entirely.  The idea of flat fee recording costs is not a bad idea, but it should be revenue neutral.  Idaho will charge a flat fee of $15.00 to record a deed beginning July 1, 2017 - they designed it to be revenue neutral.  


This bill was drafted with the intent to be revenue neutral to the counties and has no impact on the general fund. The 30-page limit and the flat fees outlined in the bill were determined through analysis of public recording information for the types of documents presented in this legislation.

I understand the importance of being able to estimate recording costs for TRID purposes and a flat fee is an attractive option. Let's see a study of recording fees so we can propose a more reasonable flat fee that won't gouge consumers.  

The other big change in the budge bill is an update to the Good Funds Law, which just went into effect on April 6, 2017. See In God We Trust... Everyone Else Gotta Pay by Wire Transfer.


Under the new statute, effective April 6, 2017, all funds over $1,000 must be "electronically transferred funds via the real-time gross settlement system provided by the federal reserve banks," commonly referred to as a Fedwire. The only exceptions are for business checks drawn on the trust account of a real estate broker (used for earnest money), and funds from the United States government, the State of Ohio, or an agency, instrumentality, or political subdivision of either.

Under the proposed changes, settlement agents will be able to accept cash or cashier's checks up to $10,000, instead of only $1,000.  And over $10,000 funds may be "any other electronically transferred funds." This opens the door to other options besides Fedwires that are comparatively more expensive.  This will really help out with local banks that have traditionally transferred funds into the settlement agent's IOTA (Interest on Trust Account) held at that bank.  

The Governor hasn't signed it yet, but it's likely that he will.   

 

 

 




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Categories: Escrow/Funding, Ohio Legislation

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Source of Title Blog

Robert A. FrancoThe focus of this blog will be on sharing my thoughts and concerns related to the small title agents and abstractors. The industry has changed dramatically over the past ten years and I believe that we are just seeing the beginning. As the evolution continues, what will become of the many small independent title professionals who have long been the cornerstone of the industry?

Robert A. Franco
SOURCE OF TITLE

 

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