patrick.net

http://www.housingwatch.com/2010/03/08/developers-embrace-new-flip-tax/?source=patrick.net

Reading the above article, I was suprised to learn of yet another way that someone is trying to screw you out of more of your money. In this case, there is a fee added to the closing costs, where someone is paid a percentage of the sale every time the property is sold. (generally anywhere from .25% to 1.75% of the sale price). In the above article, it's used to make more money for the original developers of the property, but there really isn't any law preventing an existing homeowners from sneaking the clause into a sales contract when they sell there house. What I would like to know is how this is disclosed? Would this show up on a title search? Disclosed as a condition when the original sales contract is signed. I know when I make an offer on a house in a development that had a homeowners association I had 10 days to look over the rules (it was a 300 page book no less) to opt out of the contract. (They countered offered for more money and 5 days, which I said forget it). I for one do not want to informed of this fee when reaching the settlement table. I want to know well before hand so I can tell them to forget it before I invest too much of my time and money.

If we all refuse to sign a contract that has this clause in it, it will not take builders too long to remove it entirely. (assuming that the first purchasers of the house fight it) If builders can't sell any houses, they will be forced to remove the clause.

#housing