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1. How much is the transfer fee?
One percent (1%) of the gross sales price.
2. Who pays the transfer fee?
The Covenant provides that the Seller shall pay the fee. However, a Buyer and Seller can agree otherwise.
3. Should the transfer fee appear on the HUD-1 closing statement?
Yes. See example.
4. Where should payment be sent?
IF BY MAIL
P.O. Box 6193
Round Rock, TX 78683-6193
IF BY WIRE TRANSFER
5. What happens if a transfer fee is not paid?
The unpaid fee generally will be secured by a superior lien against the property (which may be a violation of a lender’s closing instructions), and will accrue default interest until paid.
6. Does every transfer of title require a transfer fee?
No. Generally speaking, a transfer of title between spouses, a sale to a government entity, a transfer of title in connection with foreclosure, and other exemptions described in the Declaration of Covenant are exempt from payment of the fee. (The foregoing is a general description. Please refer to the covenant that imposes the fee, particularly the exemptions under section 6.)
7. Does a short sale require payment of the transfer fee?
8. Does a Deed in Lieu require payment of the transfer fee?
Typically, yes. A Deed in Lieu of foreclosure does not meet the criteria for waiver of the fee in connection with foreclosure. However, if foreclosure proceedings have been filed, then a Deed in Lieu executed after the filing of the foreclosure proceedings would be an exempt transaction, and no fee required.
9. Will the property always be encumbered by the fee?
No. The covenant, and requirement to pay the fee, typically expire in 99 years.
10. How do we know whether or not there are any unpaid fees?
We can identify any unpaid fees. Simply fill out the inquiry form.
11. What is an Estoppel Certificate?
A document provided by us, attesting whether or not any unpaid fees are due.
12. How do we obtain an Estoppel Certificate?
We will mail an Estoppel Certificate, in recordable form, within 7 days from date of our receipt of payment. This ensures that the Estoppel Certificate is dated on or after the date of closing. We can send an Estoppel Certificate prior to closing, contingent on your agreement to hold same in escrow until closing and payment of the sums due. If you desire for an Estoppel Certificate to be sent by overnight mail, you must provide us with a prepaid label. Otherwise, all documents will be mailed regular mail.
13. We are a non-profit organization that received a payment from Covenant Clearinghouse.
A portion of every transfer fee is remitted to a non-profit. This provision is embedded into every Declaration of Covenant we administer, and provides long-term funding for clean air, clean water, the environment, community services and other public benefits to the community from which the funds originated. If you are a non-profit and have received a check from Covenant Clearinghouse, these funds are tendered to you without restriction.