Relating to the provision of accounting statements by a seller who finances the sale of residential real property owned by the seller; providing a civil penalty.
The enactment of SB2293 is likely to strengthen consumer protections in the real estate market, particularly benefiting buyers who enter into seller-financed transactions. By obligating sellers to issue annual statements, the bill aims to prevent potential disputes that may arise over payment status and property taxes. The implications are significant for both sellers and buyers, as it would help clarify responsibilities and promote good practices in these types of financial agreements.
SB2293 introduces significant changes to the regulation of seller-financed sales of residential real estate. The bill mandates that sellers who finance such sales must provide annual accounting statements to buyers. This requirement aims to ensure transparency and clarity regarding the financial obligations and payments related to the property being financed. The bill stipulates that these accounting statements must be delivered annually by January 31, detailing the total amount paid by the purchaser, the remaining balance, the number of payments left, and any tax payments made on behalf of the buyer by the seller.
Notably, the bill introduces civil penalties for non-compliance with these reporting requirements. If a seller fails to provide the necessary annual statements, they may face liability for actual damages, additional damages of up to $500 per unprovided statement, and attorney fees. Sellers with only one transaction per year are subjected to a lesser penalty of $100 per missing statement, yet the enforcement of these penalties has raised discussions regarding their effect on the practice of seller financing. Some argue that such penalties may discourage individuals from offering financing, thereby limiting buyer options in the housing market.