RISMEDIA, July 30, 2010—A wide array of organizations including the American Land Title Association, the National Association of Realtors, AFSCME, Vote Vets, the Center for Responsible Lending, the Property Rights Alliance and the Institute for Liberty recently launched The Coalition to Stop Wall Street Home Resale Fees with an appeal to United States Secretary of the Treasury Timothy Geithner to ban dangerous Wall Street Home Resale Fees (also known as “private transfer fee covenants”), which have already been restricted in 17 states because of their adverse impact on homeowners and home buyers.
Members of the Coalition delivered a letter to Secretary Geithner and representatives at the U.S. Department of Housing and Urban Development, Federal Housing Finance Agency, Federal Trade Commission, Securities and Exchange Commission, Farm Credit Administration, Department of Veterans Affairs, Federal Reserve Board, Deferral Deposit Insurance Corporation, National Credit Union Administration and Office of Thrift Supervision, declaring their opposition to Wall Street Home Resale Fees and calling on the Obama Administration to ban their use.
“This dangerous new fee is a prime example of Wall Street investors trying to profit from unsuspecting homeowners,” said Kurt Pfotenhauer, President of the American Land Title Association. “We’re asking Secretary Geithner to stand up for Main Street homeowners and buyers and stop the use of Wall Street Home Resale Fees today.”
Manhattan-based Freehold Capitol Partners is leading the push to add these fees to home purchase contracts. The fees require that a percentage of the final sale price of a home be paid to a private third party every time the property is sold, typically for 99 years. Freehold is attempting to then sell the right to collect these fees on Wall Street.
“As the leading advocate for homeownership and housing issues, the National Association of Realtors strongly opposes home resale fees, or private transfer fees,” said Lucien Salvant, Managing Director for Public Affairs at the National Association of Realtors. “They add an unnecessary and unfair burden to the real estate transaction for either buyer or seller.”
The Coalition to Stop Wall Street Home Resale Fees has already been active, raising awareness about the issue and taking action to stop these dangerous fees.
To date, 17 state legislatures in Arizona, California, Florida, Hawaii, Illinois, Iowa, Kansas, Louisiana, Maryland, Minnesota, Mississippi, Missouri, North Carolina, Ohio, Oregon, Texas and Utah have recognized the dangers of Wall Street Home Resale Fees and have restricted their use.
An official with the U.S. Federal Housing Administration confirmed that the government will not insure mortgages for properties with Wall Street Home Resale Fees and the U.S. Department of Housing and Urban Development confirmed these fees violate HUD’s regulations.
“At a time when state and local governments are cutting services to the bone, it makes no sense to force them to use tax-payer dollars to dole out unearned profits to Wall Street,” said AFSCME President Gerald W. McEntee. “This financial scheme is a pipedream for Wall Street and a nightmare for everyone else.”
“Owning a home has always been part of the American dream—for veterans and non-vets alike,” said Jon Soltz, Co-Founder and Chair of Vote Vets. “We fought to preserve the American dream for all, but these greedy Wall Street Home Resale Fees mislead homeowners and make that dream more difficult to attain.”
“This country has seen enough abusive financial practices to last a lifetime,” said Uriah King, Vice President of State Policy at the Center for Responsible Lending. “Now, yet again, homeownership and family wealth are at risk because of Wall Street’s unscrupulous practices.”
“One had thought that the concept of serfdom had been abolished centuries ago, but Wall Street is trying to re-introduce the concept through these near-perpetual fees,” said Andrew Langer, President of the Institute for Liberty. “When I own my home “free and clear” it means that I have the right to keep any profits through its sale. This practice forces a landowner into a third-party’s fiefdom, watering down individual rights in the process.”
The Coalition to Stop Wall Street Home Resale Fees has organized to fight the dangerous financial scheme of transfer fee covenants and to protect homeowners across the country.
For more information, visit http://www.stophomeresalefees.org.