[r90] Murphy's Bill Securing Real Estate Transactions Gains Senate Approval (4/15/2009)

Wednesday, April 15, 2009

Start Date: 4/15/2009 All Day
End Date: 4/15/2009

(STATEHOUSE) April 15, 2009 - Hoosiers looking to buy or sell a home may soon have the guarantee that escrow transactions are good.   House Bill 1374, authored by Rep. Mike Murphy (R-Indianapolis), today passed the Senate on third reading unanimously. 

"This bill creates 'Good Funds' provisions that protect homeowners by giving them the assurance that the money that is supposed to be in their bank account is actually there," said Rep. Murphy.  "Currently, Indiana law provides no such assurance.  And in these times, this is one way to prevent problems in the future."

Primarily, the bill does three things:

  1. It requires closing agents to deposit funds into an escrow account, unless those involved agree to some other arrangement.
  2. The bill stipulates that amounts greater than $10,000 are wired and not provided as a check.  This is to guarantee the funds are good and immediately available.
  3. Allows the closing agent to advance up to $500 from and escrow account to pay off any incidental fees involved in the process of the real estate transaction. 

"Given the current foreclosure and mortgage crisis, this type of bill is a pro-active way to protect consumers and avoid delays," Rep. Murphy said.

Thirty-two states already have this type of "Good Fund" legislation.

House Bill 1374 will now return to the House for approval of Senate amendments.  If approved, the bill will head to the desk of Gov. Mitch Daniels.  If the Senate amendments are contested, the bill will head to conference committee.