Maria is purchasing her first home in Maryland for $320,000. She will use the property as her principal residence and qualifies as a first-time homebuyer under Maryland law. Which of the following correctly describes the Maryland state transfer tax obligation in this transaction?
Correct Answer
A) The state transfer tax rate is reduced to 0.25%, and the seller is statutorily required to pay the entire state transfer tax — Maria pays nothing toward the state transfer tax.
Under Md. Code Ann., Tax-Prop. § 13-203(b) and § 14-104, when all purchasers are first-time Maryland homebuyers acquiring a principal residence, the state transfer tax rate is reduced to 0.25% and the seller is required to pay the entire state transfer tax.
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Related Topics & Key Terms
Key Terms:
Related Concepts
The secondary mortgage market is where existing mortgage loans are bought and sold between lenders, investors, and government-sponsored enterprises (GSEs) like Fannie Mae, Freddie Mac, and Ginnie Mae.
TILA is a federal law that requires lenders to disclose the true cost of credit to borrowers, including the annual percentage rate (APR), total finance charges, and loan terms. It is implemented by Regulation Z.
A trustee sale is a type of foreclosure where a trustee, appointed under a deed of trust, sells the property at auction to satisfy the debt.
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