Alabama Senate Bill SB107

Alabama 2023 Regular Session

• Introduced: 3/21/23
• Refer: 3/21/23
• Report Pass: 5/10/23

Caption

To amend Section 40-22-2, Code of Alabama 1975; to increase the fee for recording of certain mortgages, deeds of trust, contracts of conditional sale, or other instruments of like character which is given to secure the payment of any debt which conveys any real or personal property; and to modify the rate and distribution of the mortgage record tax in order to provide a dedicated revenue for the Alabama Housing Trust Fund.

Impact

The enactment of SB107 will have direct implications for state law regarding the financial processing of property transactions. By increasing the recording fees associated with mortgages and similar instruments, the bill introduces a new fiscal dynamic for individuals and businesses entering real estate transactions. The revenue generated will not only support the Alabama Housing Trust Fund but will also ensure a more structured allocation of funds among state and local entities, enhancing the financial capacity of the housing foundation. In doing so, the legislation aims to facilitate broader access to housing financing and potentially improve housing stock quality statewide.

Summary

SB107 seeks to amend Section 40-22-2 of the Code of Alabama 1975 by increasing the fees required for recording certain financial instruments, specifically mortgages and deeds of trust. The intended outcome is to modify the rates and distribution structure of the mortgage record tax. A substantial portion of the revenue generated from these increases will be allocated to the Alabama Housing Trust Fund, which is a critical financial resource aimed at providing affordable housing solutions across the state. This initiative aligns with the growing concern over the accessibility of housing and reflects legislative efforts to prioritize funding for this purpose.

Contention

Notable points of contention surrounding the legislation may arise from stakeholders concerned about the increased financial burden placed on borrowers. Critics may argue that higher recording fees could discourage property transactions or disproportionately affect lower-income families striving to secure home loans. Additionally, the allocation of revenue specifically to the Alabama Housing Trust Fund may prompt debates on transparency and the effectiveness of funding distribution. Stakeholders may question the long-term impacts on housing affordability and availability in the wake of increased transaction costs.