#United States #Rhode Island #ALTA #NTRAPS

Rhode Island Takes a Stand Against Predatory Real Estate Practices

In a significant move to protect homeowners, Rhode Island has passed House Bill (HB) 5185 and Senate Bill (SB) 133, aimed at safeguarding property rights against unfounded fee agreements known as Non-Title Recorded Agreements for Personal Services (NTRAPS). These agreements often serve as a burden on homeowners, leading to unreasonable transaction costs and potential financial instability.

The American Land Title Association (ALTA), along with AARP and the New England Land Title Association (NELTA), has lauded this legislation, emphasizing its critical role in ensuring fair real estate practices. According to ALTA's chief of strategy, communications, and innovation, Elizabeth Blosser, protecting the rights of homeowners is essential for their future financial security, enabling them to sell or refinance their homes without excessive costs or unreasonable restrictions.

Samar Jha, the government affairs director at AARP, highlighted that this law is part of a broader advocacy effort aimed at eradicating harmful practices across states. She expressed optimism about similar legislative measures that could emerge nationwide to further protect homeowners.

The passing of HB 5185/SB 133 marks a continuation of efforts across various states to address the predatory nature of NTRAPS, while also creating remedies for existing agreements. Mark Bennett, Executive Director of NELTA, appreciates the state's initiative to protect consumers, reflecting a growing awareness and action against unfair practices in real estate.

Moreover, the bill aims to:
1. Render NTRAPS unenforceable by law.
2. Prohibit their recording in property records.
3. Impose penalties for any attempt to record NTRAPS.
4. Allow for the removal of NTRAPS from official records, enabling homeowners to seek damages if necessary.

These protective measures are particularly crucial for older residents, as emphasized by Catherine Taylor, AARP Rhode Island's state director. The home often represents their most valuable asset, and without adequate safeguards, these individuals risk losing their financial stability.

This new legislative framework positions Rhode Island as a pioneer in real estate reform, aligning with ongoing trends to uphold property rights and ensure equitable treatment for homeowners. As a result, the bill not only aims to foster a fairer housing environment in Rhode Island but also sets a potential precedent for other states grappling with similar issues.

Following the June 13, 2025 signing of the legislation by Governor Dan McKee, Rhode Island joins 33 other states that have enacted laws addressing NTRAPS, marking a concerted effort to combat predatory real estate practices across the nation. Through continued advocacy and legislative reform, stakeholders hope to create a more just and transparent real estate landscape for both current and future homeowners.