Who Pays Recording Fees?
By Jim Palmer Jr.

In all real estate transactions there are recording fees, which is what the county charges to record documents such as a statutory warranty deed, note and deed of trust, fulfillment deeds, property line adjustments, surveys or other documents that are entered into the public record.  Those fees show up on the settlement statement in each transaction and in the past were generally considered a nominal amount in the whole scheme of total costs.  That is no longer the case!

This year the legislature approved and the Governor signed the bill that recently went into effect.  Previously the recording fee was $103.50 for the first page of a document and another $1 for every additional page.  Starting in July an extra $100 will be tacked on to that fee for each document recorded throughout the state.

The intent of this new charge is to raise money to assist with combating homelessness across the state.  Once counties collect those fees they will be passed on to the State Treasurer for allocation into the following programs: 1) 4% to the Landlord Mitigation Program. 2) 20% to support maintenance and operation of permanent supportive housing. 3) The remainder goes to the Home Security Fund, which will then be split 40/60 between rental assistance programs and project-based voucher projects.

In one recent case, where two lots were being purchased on separate owner contracts, the recording fees assigned to buyer (on each transaction) were in excess of $600.  The buyer had not anticipated that additional $1,200 cost just for recording fees and had to scramble to mitigate this unforeseen cost.

Of course this new “tax” to consumers is mostly hidden from the general public, but when it comes out of your pocket it becomes more personal and one has to wonder why.

Whether you agree with the politics of this change or not, it is here and the consequences are causing issues in real estate transactions.  In the past, closers traditionally charged the recording fees to whichever party the documents benefited most, but there is no hard and fast rule on that arbitrary distribution.  MLS attorneys are already discussing changes to state-wide purchase contracts in order to address this issue.  In the future it is likely that this will not be a cost that is arbitrarily assigned by a closing company, but instead will be contractually negotiated between seller and buyer.