Protecting Homeowners: Indiana Passes Legislation Against Predatory Real Estate Practices
The American Land Title Association (ALTA), in collaboration with AARP Indiana and the Indiana Land Title Association (ILTA), commends the Indiana General Assembly for the passage of House Bill (HB) 1222, aimed at safeguarding homeowners from the predatory practice of filing unfair real estate fee agreements, known as Non-Title Recorded Agreements for Personal Services (NTRAPS). This legislation, supported by ALTA Vice President of Government Affairs Elizabeth Blosser, ensures the protection of property rights for American homebuyers, mitigating unwarranted transactional costs that could hinder future property transactions.
NTRAPS, recorded in property records since 2018, exploit homeowners by offering nominal cash gifts in exchange for long-term contracts granting exclusive selling rights, impeding property transfers or refinancing. AARP Government Affairs Director Samar Jha emphasizes the importance of legislative action in ending such harmful practices, aligning with ALTA’s advocacy efforts nationwide to safeguard homeowners from predatory housing practices.
HB 1222 follows a national trend of similar bills, seeking to address existing NTRAPS and deter future unfair practices, thereby fortifying homeowner protections. ILTA President Michael Schmitz underscores the legislation’s significance in preserving consumer interests and maintaining the integrity of property title chains, reflecting collaborative efforts with Indiana legislators to pass comprehensive legislation.
The new law mandates the unenforceability of NTRAPS, prohibits their recording in property records, imposes penalties for violations, and facilitates the removal of NTRAPS from property records, ensuring accountability and recourse for affected homeowners. AARP Indiana Legislative Director Ambre Marr underscores the pivotal role of such protections in enabling older adults to age in place and maintain financial stability.
Indiana Governor Eric Holcomb is expected to endorse HB 1222 into law imminently, marking a crucial step towards safeguarding homeowner rights and promoting fair real estate practices across the state.
