AUSTIN, Texas, Feb. 17, 2017 /PRNewswire/ -- In 2012 the Federal Housing Finance Agency ("FHFA") issued a Final Rule (codified at 12 C.F.R. Part 1228) related to private transfer fee covenants. The Final Rule regulates Fannie Mae, Freddie Mac and the Federal Home Loan Board banks' purchase of securities backed by mortgages on properties encumbered by certain private transfer fee covenants, as well as securities backed by the income stream from such covenants.
In taking the regulatory action the FHFA made clear that the "rule does not prohibit any private transfer fees," and further clarified that the "rule regulates neither private transfer fee covenants nor market participants who create or use them." Instead, the rule simply regulates the types of mortgage-backed securities that can be held by the regulated entities.
According to Freehold Capital Partners, (the "Company"), the primary originator of private transfer fees (also called capital recovery fees), the FHFA's Final Rule has had no discernible impact on homebuyers acquiring property encumbered by a private transfer fee assessment, nor on developers who use them. According to a Company spokesperson, "the Rule simply governs what regulated entities can and cannot do. It has had no impact on the private sector use of this important real estate tool. We did not expect any negative impact from the Rule, and we are pleased to see that our expectations were well-founded." The Company reports that closings continue to occur smoothly.
For more information on the FHFA Rule, see Private Transfer Fees, A Rule by the Federal Housing Finance Agency (Federal Register, Mar. 16, 2012).
About Freehold Capital Partners: With a portfolio covering an estimated four hundred thousand properties, Freehold Capital Partners is the leader in capital recovery fee assessments. Learn more at www.freeholdcapitalpartners.com
DISCLAIMER: For general information purposes only. Although the Company believes all information contained within this release to be accurate, no guarantee of accuracy is expressed or implied and no reliance shall be made thereupon. Nothing herein shall be deemed legal advice. The Company undertakes no obligation to update this information.
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SOURCE Freehold Capital Partners