(STATEHOUSE) Feb. 12, 2009 - Hoosiers looking to buy or sell a home may soon have the guarantee that escrow transactions are good if House Bill 1374, authored by Rep. Mike Murphy (R-Indianapolis), is successful. On Thursday, the House of Representatives voted unanimously, 73-0, to pass the bill on third and final reading.
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"Currently, Hoosiers have no assurance that the check they receive from a closing agent is good," Rep. Murphy said. "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."
Primarily, the bill does three things:
- It requires closing agents to deposit funds into an escrow account, unless those involved agree to some other arrangement.
- 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.
- 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.
The bill will now head to the Senate.