California Government Code 27388.1: Fees, Cap, and Exemptions

California Government Code section 27388.1 imposes a $75 recording surcharge on most real property documents filed with a county recorder, capped at $225 per transaction per parcel, with the money directed to affordable housing rather than fraud enforcement. It was added by Senate Bill 2, the Building Homes and Jobs Act, and took effect January 1, 2018. Despite being commonly called the “real estate fraud fee,” it has nothing to do with fraud; that charge sits in a different statute.¹

What the Fee Funds

The Legislature created section 27388.1 as a dedicated revenue stream for affordable housing production. After county recorders deduct their actual administrative costs, the balance is remitted to the State Controller and deposited into the Building Homes and Jobs Trust Fund, which supports local and regional housing programs for low- and moderate-income Californians.¹

How Much You Pay and the $225 Cap

The charge is $75 per recorded document, per parcel, added on top of the county’s standard base recording fees. When a single transaction requires more than one document for the same parcel, the fee stacks at $75 each, but the total for that transaction and parcel cannot exceed $225.¹

So if you record a deed of trust, a subordination agreement, and a homestead declaration together for the same parcel, you pay $225. A fourth document in that same transaction adds nothing further under this statute; you have already hit the ceiling.

Which Documents Trigger the Fee

The statute reaches any document relating to real property that is required or permitted by law to be recorded. It gives a non-exhaustive list of examples:

Deeds, including grant deeds, trustee’s deeds, and quit claim deeds
Deeds of trust, fictitious deeds of trust, reconveyances, and assignments of deeds of trust
Abstracts of judgment, mechanic’s liens, and UCC financing statements
Notices of default, requests for notice of default, and notices of trustee sale
Declarations of homestead and abandonments of homestead
Subordination agreements, easements, notices of completion, releases or discharges, maps, and covenants, conditions, and restrictions

Because the statutory language reads “including, but not limited to,” county recorders apply the fee to other recorded real property documents as well.¹

The Five Exemptions

Section 27388.1 carves out five categories of documents that are not subject to the $75 fee. Most residential home sales fall within one of the first two, which is why many buyers never see this charge on their closing statement.

Transfers subject to documentary transfer tax. When a sale involves consideration and the county collects documentary transfer tax under Revenue and Taxation Code 11911, the documents recorded for that transfer are exempt. This covers most arm’s-length sales.
Residential transfers to an owner-occupier. Documents recorded in connection with transferring a residential dwelling to someone who will live in it are exempt even when no documentary transfer tax is due.
Federal government documents recorded under the Uniform Federal Lien Registration Act.
Documents executed or recorded by the state, a county, a municipality, or another political subdivision. AB 110 later clarified that public agencies were never intended to pay the fee.
Documents recorded to remove a restrictive covenant that violates California’s fair housing laws under Civil Code 12955.

The practical effect is that the fee lands primarily on non-sale recordings: refinance documents, lien filings, easements, default notices, and other instruments where neither a transfer-tax sale nor an owner-occupier transfer is involved.¹

Claiming an Exemption

Exemptions are not automatic. The person preparing the document must include a written declaration of exemption on the face of the document or on a cover sheet submitted with it, and the declaration must identify the specific reason the fee does not apply. Without a valid exemption statement, the recorder will charge $75 even if the document actually qualified.²

A missing or incorrect declaration cannot be fixed after recording, and there is no straightforward refund path. Title companies and escrow officers handling residential sales routinely include the correct language. If you are recording a document yourself, confirm the declaration is on the page before you submit.

Not the Real Estate Fraud Fee

Section 27388.1 is routinely confused with Government Code section 27388, which sits one line above it in the code and is the actual real estate fraud fee. Section 27388 is a separate, optional charge of up to $10 per recorded real estate document, adopted at the county level by a board of supervisors resolution. Not every county imposes it.³

The two fees differ in every meaningful way:

Section 27388 funds local district attorneys and police who investigate and prosecute real estate fraud. Section 27388.1 funds statewide affordable housing programs.
Section 27388 caps at $10 per document. Section 27388.1 is $75 per document.
Section 27388 money stays in the county’s Real Estate Fraud Prosecution Trust Fund, split 60/40 between district attorneys and local law enforcement. Section 27388.1 money leaves the county for the state Building Homes and Jobs Trust Fund.
Section 27388.1 is mandatory statewide. Section 27388 requires a county resolution to take effect.

A recording receipt in California may list both charges on separate lines. The exemptions for one do not apply to the other.³

What This Means for Your Transaction

If you are buying a home in a standard sale where documentary transfer tax is paid, or taking title to a residence you will occupy, the $75 fee generally drops out through an exemption and you will not see it on your closing figures. If you are refinancing, recording a lien, filing a notice of default, or recording an easement or similar non-sale instrument, expect the fee to apply, and expect it to stack up to $225 if the transaction involves multiple documents on the same parcel. Confirm that any exemption you believe applies is declared on the document itself before it reaches the recorder, because once it is recorded with the fee charged, undoing it is not practical.

1
California Legislative Information. California Government Code 27388.1
2
The Bar Association of San Francisco. Building Homes and Jobs Act Requires New Document Recording Fees
3
California Legislative Information. California Government Code 27388