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Coding: Words which are struck through are deletions from existing law;
words in boldface type and underscored are additions.
Regular Session, 2014
SENATE BILL NO. 426
BY SENATOR LAFLEUR
COMMERCIAL REGULATIONS. Prohibits required use of settlement service providers
in residential real estate transactions. (8/1/14)
AN ACT1
To enact R.S. 51:1428, relative to unfair trade practices and consumer protection; to prohibit2
the required use of settlement service providers in residential real estate transactions;3
to provide for definitions; to provide for certain terms, conditions, and procedures;4
and to provide for related matters.5
Be it enacted by the Legislature of Louisiana:6
Section 1. R.S. 51:1428 is hereby enacted to read as follows:7
ยง1428. Unfair or deceptive acts or practices; prohibition against required use8
of settlement service providers in residential real estate9
transactions10
A. For the purposes of this Section, the following terms and phrases11
shall have the following meanings:12
(1) "Purchaser" means any person who, using the proceeds of a13
federally related mortgage loan, contracts to acquire residential real estate in14
this state.15
(2) "Residential real estate" means any immovable property in this state16
upon which at least one, but not more than four, buildings or structures are17 SB NO. 426
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Coding: Words which are struck through are deletions from existing law;
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situated, each of which are occupied or intended for occupancy as single family1
residences.2
(3) "Federally related mortgage loan" means any loan defined as a3
"federally related mortgage loan" under the provisions of 12 U.S.C. 2602(1) of4
the Real Estate Settlement Procedure Act of 1974.5
(4) "Settlement services" means any service defined as a "settlement6
service" under the provisions of 12 U.S.C. 2602(3) of the Real Estate Settlement7
Procedure Act of 1974, except flood certificates, tax services, appraisals, home8
inspections and related testing services, and credit reports.9
(5) "Seller" means any natural or juridical person who contracts to sell10
residential real estate in this state.11
B. No contract to sell or purchase residential real estate executed in this12
state shall contain any provision requiring the purchaser of such residential13
property, as a condition of such sale, to use a specific provider of settlement14
services.15
C. No seller shall deprive, impair, diminish, or otherwise limit the access16
of a purchaser of residential real estate to any service, discount, rebate, or other17
economic incentive by making such access contingent on that purchaser's use18
of a specific provider of settlement services.19
D. No seller shall impose upon a purchaser of residential real estate an20
economic disincentive or penalty based on the failure or refusal of such21
purchaser to use a specific provider of settlement services.22
E. Any violation of this Section shall be a deceptive and unfair trade23
practice and shall subject the violator to any and all penalties provided for in24
this Chapter.25
F. The provisions of this Section shall not apply to lenders.26 SB NO. 426
SLS 14RS-332 ENGROSSED
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Coding: Words which are struck through are deletions from existing law;
words in boldface type and underscored are additions.
The original instrument and the following digest, which constitutes no part
of the legislative instrument, were prepared by Michelle Ducharme.
DIGEST
LaFleur (SB 426)
Proposed law defines "purchaser", "residential real estate", "federally related mortgage
loan", "seller", and "settlement services".
Proposed law provides that no contract to sell or purchase residential real estate executed in
this state shall contain any provision requiring the purchaser of such residential property, as
a condition of such sale, to use a specific provider of settlement services.
Proposed law provides that no seller shall deprive, impair, diminish, or otherwise limit the
access of a purchaser of residential real estate to any service, discount, rebate, or other
economic incentive by making such access contingent on that purchaser's use of a specific
provider of settlement services.
Proposed law provides that no seller shall impose upon a purchaser of residential real estate
an economic disincentive or penalty based on the failure or refusal of such purchaser to use
a specific provider of settlement services.
Proposed law provides that any violation of proposed law shall be a deceptive and unfair
trade practice and shall subject the violator to any and all penalties provided for in law.
Proposed law exempts lenders from provisions of proposed law.
Effective August 1, 2014.
(Adds R.S. 51:1428)
Summary of Amendments Adopted by Senate
Committee Amendments Proposed by Senate Committee on Commerce, Consumer
Protection, and International Affairs to the original bill
1. Exempts certain services from the definition of "settlement services".
2. Defines "seller" as any natural or juridical person who contracts to sell
residential real estate in this state.
3. Exempts lenders from the provisions of proposed law.