Allowing the department of justice to authorize the preclosing use of a portion of a deposit held in escrow for the payment of certain construction customizations, upgrades, or change orders.
Summary
SB 26 revises New Hampshire’s land sales and condominium laws to define “deposits” more narrowly as earnest money paid under a purchase and sales agreement. Under the bill, deposits would not include amounts paid for buyer-selected customizations, upgrades, change orders, or similar additional items. The bill makes parallel changes in both the Land Sales Full Disclosure Act and the Condominium Act so the definition applies across those real estate contexts.
The bill also changes escrow rules for these deposits. In general, earnest-money deposits would still have to be held in escrow until closing or settlement, but the Department of Justice’s Consumer Protection and Antitrust Bureau would be allowed to authorize the preclosing use of part of a deposit for customizations, upgrades, change orders, or similar items, subject to reasonable conditions. The bill preserves existing protections that escrow funds are not subject to attachment by the creditors of the buyer or seller/developer, and it takes effect 60 days after passage.
Impact
SB 26 would amend RSA 356-A and RSA 356-B by adding a statutory definition of “deposits” and revising escrow provisions for subdivided land and condominium transactions. It would affect developers, buyers, real estate brokers, attorneys holding escrow funds, and the Department of Justice’s Consumer Protection and Antitrust Bureau, which would gain express authority to approve limited preclosing use of escrowed funds for specified construction-related items.
Sentiment
The available context suggests the bill is generally pro-consumer and pro-industry in a practical sense, aiming to clarify how deposits are treated and to allow funds to be used for agreed-upon buyer selections before closing. The bill’s caption indicates a targeted administrative change rather than a broad policy shift, and there is no recorded vote or committee transcript in the provided materials showing organized opposition or support. Overall, the measure appears to have been framed as a technical clarification with a limited consumer-protection oversight role for the Department of Justice.
Contention
The main point of potential contention is the preclosing use of escrowed deposit funds. Supporters would likely view the change as a way to facilitate payment for customizations, upgrades, and change orders that buyers have already selected, while critics could be concerned about reducing the traditional protection of keeping deposits fully escrowed until closing. Another possible issue is the scope of the Department of Justice’s discretion to authorize these uses and impose conditions, since that gives the bureau oversight over when and how escrowed money may be released.