SB 1175 Summary

• Amends Arizona Revised Statutes Section 33-442 to clarify and strengthen the prohibition on transfer fees in real property documents and covenants.

• Makes transfer fee provisions unenforceable and unenforceable liens if they attempt to bind successors in title and require payment of fees to a declarant or third party upon transfer of property interests.

• Applies retroactively to July 28, 2010, establishing that transfer fee covenants executed after that date are not binding or enforceable.

• Preserves exceptions to the prohibition for loan assumption fees, real estate broker commissions, association fees that touch and concern the land, lease payments, options or rights of first refusal, club memberships, governmental charges, and direct consideration between transferor and transferee.

• Clarifies the definition of "association" to include nonprofit organizations qualifying under IRS sections 501(c)(3) or 501(c)(4) and nonprofit mandatory membership organizations created by declaration or covenant.