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Bill would ban "residential transfer" fees in Michigan

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A new type of real estate fee, charged to people selling their home, is getting some attention at the state capital. 

So-called "residential transfer" or "capital recovery" fees are becoming much more common.

They're often included in a home's deed, or in the paperwork buyers sign when purchasing a home. They require homeowners to pay a set fee, usually one percent of a home's sale price, to the original builder.

The fees can be assessed for up to 99 years.

State Representative Paul Opsommer wants to make the practice illegal in Michigan.

"Selling a home today isn't easy to begin with," Opsommer said. "Creating new fees and tacking them on top of that just simply hurts a market that's already in big big trouble."

Opsommer warned homeowners to be on the lookout for such fees.

"When you're buying or selling a home, it's something that people should start to look into, to see if that's been included within the purchase agreement of their home," he said. "And it's probably going to be in a separate agreement, or separate piece of paper buried amongst the 10 or 20 that you end up signing when you end up buying a home."

Eleven other states have already outlawed such fees, including, most recently, Ohio.

Opsommer introduced legislation banning the practice late last month.

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