HB2768 Summary

• Prohibits and voids transfer fee provisions in property declarations, covenants, or documents that require transferees or transferors to pay fees to a declarant or third party upon property transfer.

• Declares unenforceable transfer fee covenants are not binding on successors in title, create no lien rights, and any purported liens arising from such provisions are invalid.

• Exempts from the prohibition: loan assumption fees, real estate broker commissions, association fees touching the land, lease payments, option/right of first refusal payments, club membership fees, nonprofit recreational activity fees, government-imposed taxes, and consideration paid directly between transferor and transferee.

• Applies to transfer fee covenants executed after the effective date of the act and expresses no opinion on enforceability of covenants executed before that date.

• Establishes legislative finding that transfer fee covenants violate Arizona public policy by impairing real property marketability and constituting unreasonable restraints on alienation.