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California · TitleCalifornia private transfer fees: payable only with a recorded Payment of Transfer Fee Required notice

California defines a transfer fee as any fee required by a covenant, restriction or condition in a deed, contract, security instrument or other document affecting the transfer or sale of real property that must be paid because of the transfer (Civil Code §1098(a)). The definition excludes, among others, fees or taxes imposed by a government, mechanics' lien fees, court-ordered payments, payments in a separation or divorce, estate and trust administration charges, lender fees, and assessments or fees authorized by the Davis-Stirling Act for common interest developments (§1098(a)(1)–(7)). For a transfer fee imposed on or after January 1, 2008, the person or entity imposing it must, as a condition of payment, record with the county recorder at the same time as the instrument creating it a separate document titled Payment of Transfer Fee Required in at least 14-point bold type (§1098.5(b)(1)). That document lists the current owners, the legal description and parcel number, the flat amount, percentage or calculation method, dollar examples for residential property priced by value, the expiration date if any, the purpose and the payee with contact details (§1098.5(b)(2)).

What the statutes set

  1. Definition (§1098(a))

    A fee on transfer required by a covenant or condition in a recorded document.

  2. Exclusions (§1098(a)(1)–(7))

    Government fees, court orders, Davis-Stirling association charges, lender fees and more.

  3. Recorded notice (§1098.5(b)(1))

    Payment of Transfer Fee Required, in 14-point bold, as a condition of payment.

  4. Contents (§1098.5(b)(2))

    Owners, parcel, amount or method, examples, expiration, purpose and payee.

What the TC checks when a California title report shows a transfer fee

  • Look for a recorded Payment of Transfer Fee Required document on the parcel.
  • Compare the fee's amount or calculation method with the purchase price.
  • Put the fee on the settlement statement for the party the contract names.

Questions about California private transfer fees

What is a private transfer fee in California?

A fee required by a covenant, restriction or condition in a recorded document that must be paid when the property is transferred, excluding government fees and the other listed items (Civ. Code §1098(a)).

What must be recorded for a California transfer fee?

A separate document titled Payment of Transfer Fee Required with the owners, amount, examples, expiration, purpose and payee (Civ. Code §1098.5).

Related guides

Track the transfer fee notice and the payoff as tasks on the deal in ClosingCode.

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Sources: Civil Code §§1098, 1098.5 (leginfo.legislature.ca.gov), read October 31, 2026.

General information, not legal advice. ClosingCode is software; it is not a law firm or brokerage. This guide is not a substitute for the advice or services of an attorney.