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MA S705
Bill
AI Summary
- Creates new Chapter 255G requiring shared equity investors to obtain a license from the Commissioner of Banks before making investments in residential properties (1-4 unit dwellings) in Massachusetts
- Defines shared equity investments as non-recourse transactions where an investor provides a lump sum to a homeowner in exchange for an equity interest in the property or a future payment obligation upon certain conditions
- Caps the annualized cost of shared equity investments at 20% and requires homeowners to retain at least 10% beginning home equity after the investment (except for home purchases)
- Mandates detailed disclosures to homeowners including settlement examples at various time frames and appreciation scenarios, a 3-business-day rescission period, and prohibits prepayment penalties
- Establishes enforcement through the Commissioner with penalties up to $5,000 per violation (maximum $100,000), criminal penalties up to $2,000 fine and/or 5 years imprisonment, and exempts banks, credit unions, government entities, and investors making 12 or fewer investments annually
Legislative Description
Relative to home investments
Last Action
Hearing rescheduled to 11/18/2025 from 10:30 AM-01:00 PM in A-2 and Virtual Hearing updated to New End Time
11/18/2025
Committee Referrals
Financial Services2/27/2025
Full Bill Text
No bill text available