CLTA News Express
An Express Article from the California Land Title Association
Bulletin 2005/06 – 49 - October 31, 2005
NEW STAMP AND COVERSHEET REQUIREMENT FOR TITLE COMPANIES FOR ILLEGAL PROPERTY RESTRICTIONS
Recently, AB 394 (Niello), was signed into law and will require title companies to modify the stamp or coversheet they currently attach to copies of recorded documents they provide to consumers and clients warning them about potentially illegal property restrictions that may be contained in older recorded documents. This new law will expand the current warning provided to the consumer to include references to “source of income” and “sexual orientation.”
Existing law, Government Code Section 12956.1 (b), requires a title insurance company and escrow company to provide a cover sheet or stamp on copies of attached recorded documents that states the following:
"If this document contains any restriction based on race, color, religion, sex, familial status, marital status, disability, national origin, or ancestry, that restriction violates state and federal fair housing laws and is void, and may be removed pursuant to Section 12956.1 of the Government Code. Lawful restrictions under state and federal law on the age of occupants in senior housing or housing for older persons shall not be construed as restrictions based on familial status."
AB 394 changes the statutory form of notice by adding the terms “source of income,” (as defined in subdivision (p) of Government Code Section 12955) and “sexual orientation,” to the above list of illegal restrictions in Government Code Section 12956.1 (b).
The new stamp or coversheet must read as follows:
If this document contains any restriction based on race, color, religion, sex, sexual orientation, familial status, marital status, disability, national origin, source of income as defined in subdivision (p) of Section 12955, or ancestry, that restriction violates state and federal fair housing laws and is void, and may be removed pursuant to Section 12956.2 of the Government Code. Lawful restrictions under state and federal law on the age of occupants in senior housing or housing for older persons shall not be construed as restrictions based on familial status. [Emphasis added]
This new requirement goes into effect on January 1, 2006.
To read a full version of the bill, please go to the following link: http://www.leginfo.ca.gov/pub/bill/asm/ab_0351-0400/ab_394_bill_20050922_chaptered.pdf (PDF)
