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Bill would extend exemption period for recording tax on security deeds from three to seven years
Summary
Sponsor said HB 586 would lengthen the current exemption on the intangibles recording tax for recorded security deeds from three years to seven years, allowing longer loans and greater interest-rate certainty for borrowers while limiting fiscal impact on local governments.
House Bill 586 proposes extending Georgia's exemption on the intangibles recording tax for recorded security deeds from three years to seven years.
The sponsor told the committee the current practice — often structured as 35-month loans renewed every three years to avoid the tax — creates paperwork and interest-rate uncertainty for borrowers. "This measure would allow longer loans and give interest rate certainty to the borrower and thereby reduce paperwork on both the borrower and the banker," the presenter said, noting the banking community supports the change and the sponsor expects minimal fiscal impact on local governments that collect the tax.
Sponsor testimony said banks currently structure loans to avoid the three-year threshold, and extending the exemption to seven years would let lenders offer longer-term arrangements without triggering the tax. The committee did not record a vote during the presentation.
Why it matters: Extending the exemption could change lending practices, reduce administrative burden for borrowers and lenders, and provide greater rate stability for mortgage-like loans.
Next steps: HB 586 was presented to the committee and may proceed through rule and floor consideration; no vote was recorded during this hearing.
