Key legislation amending the Pennsylvania Private Road Act was approved by the General Assembly and signed into law as Act 75 of 2021.
The Act amends the Private Road Act to provide for maintenance agreements in the absence of a written agreement, and it was a key priority bill for the Pennsylvania Association of Realtors® this session.
PAR worked closely with Rep. Gary Day (R-Berks) to advance House Bill 523 because we have heard from many members about difficulties with home sales on private roads without maintenance agreements. Regulations for federally backed mortgages like Fannie Mae, VA, USDA and FHA loans require these properties to have an agreement for the maintenance of the private roadway, outlining responsibility of repairs, including what each owner’s share is, remedies for default and terms of the agreement. Without an agreement in place, these lenders will not provide financing to close the transaction.
“PAR has heard countless stories from members from around the state about closings being delayed or deals collapsing due to private roadway issues,” said PAR President Christopher Raad. “PAR strongly advocated for passage of this legislation and we’re pleased that the legislature recognized the importance of amending this statute.”
With Act 75 signed into law and taking effect in 60 days, Pennsylvania will now have a minimum statutory maintenance agreement in place for all properties on private roads. And, this minimum standard will satisfy federally backed mortgage requirements, even if a property does not have a previously agreed-to maintenance agreement.
Property owners may still choose to create their own written agreements with neighboring property owners on a private road, and the new law provides that homeowners may take civil action to remedy conflicts over maintenance of their private roads.