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Bill

HB 871

Real Property - As enacted, adds requirements for declarant access to and use of deposits made in connection with the purchase or reservation of a condominium unit; makes other similar changes. - Amends TCA Title 66.

114th Regular Session (2025-2026) Introduced by Iris Rudder

Expands declarant access to condominium purchase deposits in Tennessee, affecting developer financing and buyer protections in residential real estate transactions.

Comp. became Pub. Ch. 180
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Bill Summary · HB 871

Legislative bill overview

HB 871 modifies Tennessee's condominium law by establishing new requirements governing how declarants (developers) can access and use deposits made by buyers during the purchase or reservation of condominium units. The bill amends Title 66 of the Tennessee Code and became effective as Public Chapter 180 in April 2025.

Why is this important

Condominium deposits represent significant consumer funds held in escrow during the purchase process. These changes directly affect both buyer protections and developer cash flow management, potentially influencing condo project financing, buyer confidence, and dispute resolution in Tennessee's real estate market.

Potential points of contention

  • Developer vs. buyer interests: Rules governing when and how developers can access deposits balance competing interests—developers need funds for project development while buyers need assurance their money is protected if deals fall through
  • Escrow account requirements: Specifics on deposit handling, interest accrual, and account management could impose administrative costs on developers or create compliance challenges
  • Contingency protections: Unclear from available text whether changes limit deposit forfeiture rights, affect timelines for release, or modify conditions under which developers can claim funds

Compiled from official sources — confirm details with the bill’s official record.

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