Text: HSB00167 Text: HSB00169 Text: HSB00100 - HSB00199 Text: HSB Index Bills and Amendments: General Index Bill History: General Index
PAG LIN 1 1 Section 1. NEW SECTION. 16.92 REAL ESTATE TRANSFER 1 2 MORTGAGE RELEASE CERTIFICATE. 1 3 1. DEFINITIONS. As used in this section, unless the 1 4 context otherwise requires: 1 5 a. "Division" means the title guaranty division in the 1 6 Iowa finance authority. 1 7 b. "Mortgage" means a mortgage or mortgage lien on an 1 8 interest in real property in this state given to secure a loan 1 9 in an original principal amount of five hundred thousand 1 10 dollars or less. 1 11 c. "Mortgagee" means the grantee of a mortgage. If a 1 12 mortgage has been assigned of record, the mortgagee is the 1 13 last person to whom the mortgage is assigned of record. 1 14 d. "Mortgage servicer" means the mortgagee or a person 1 15 other than the mortgagee to whom a mortgagor or the 1 16 mortgagor's successor in interest is instructed by the 1 17 mortgagee to send payments on a loan secured by the mortgage. 1 18 A person transmitting a payoff statement for a mortgage is the 1 19 mortgage servicer for purposes of such mortgage. 1 20 e. "Mortgagor" means the grantor of a mortgage. 1 21 f. "Payoff statement" means a written statement furnished 1 22 by the mortgage servicer which sets forth all of the 1 23 following: 1 24 (1) The unpaid balance of the loan secured by a mortgage, 1 25 including principal, interest, and any other charges properly 1 26 due under or secured by the mortgage, or the amount required 1 27 to be paid in order to release or partially release the 1 28 mortgage. 1 29 (2) Interest on a per-day basis for an amount set forth 1 30 pursuant to subparagraph (1). 1 31 (3) The address where payment is to be sent or other 1 32 specific instructions for making a payment. 1 33 (4) The legal description of the property to be released 1 34 from the mortgage, and the legal description of the property 1 35 that will continue to be subject to the mortgage if, after 2 1 payment of the unpaid balance of the loan secured by the 2 2 mortgage, the mortgage continues to secure any unpaid 2 3 obligation due the mortgagee or any unfunded commitment by the 2 4 mortgagor to the mortgagee. 2 5 g. "Real estate lender or closer" means a person licensed 2 6 to regularly lend moneys to be secured by a mortgage on real 2 7 property in this state, a licensed real estate broker, or a 2 8 licensed attorney. 2 9 2. EXECUTION OF CERTIFICATE OF RELEASE. A duly authorized 2 10 officer or employee of the division may execute and record a 2 11 certificate of release in the real property records of each 2 12 county in which a mortgage is recorded as provided in this 2 13 section if all of the following are satisfied: 2 14 a. The real estate lender or closer has certified in 2 15 writing to the division all of the following: 2 16 (1) That the payoff statement satisfies one of the 2 17 following: 2 18 (a) The statement does not indicate that the mortgage 2 19 continues to secure an unpaid obligation due the mortgagee or 2 20 an unfunded commitment by the mortgagor to the mortgagee. 2 21 (b) The statement contains the legal description of the 2 22 property to be released from the mortgage and the legal 2 23 description of the property that will continue to be subject 2 24 to the mortgage. 2 25 (2) That payment was made in accordance with the payoff 2 26 statement, including a statement as to the date the payment 2 27 was received by the mortgagee or mortgage servicer, as 2 28 evidenced by one or more of the following in the records of 2 29 the real estate lender or closer or its agent: 2 30 (a) A bank check, certified check, escrow account check, 2 31 real estate broker trust account check, or attorney trust 2 32 account check that was negotiated by the mortgagee or mortgage 2 33 servicer. 2 34 (b) Other documentary evidence of payment to the mortgagee 2 35 or mortgage servicer. 3 1 (3) That more than thirty days have elapsed since the date 3 2 the payment was sent. 3 3 b. The division determines that an effective satisfaction 3 4 or release of the mortgage has not been executed and recorded 3 5 within thirty days after the date payment was sent or 3 6 otherwise made in accordance with a payoff statement. 3 7 c. The division, at least thirty days prior to executing 3 8 the certificate of release, sends by certified mail, to the 3 9 last known address of the mortgage servicer, written notice of 3 10 its intention to execute and record a certificate of release 3 11 pursuant to this section after expiration of the thirty-day 3 12 period following the sending of such notice, including 3 13 instructions to notify the division of any reason why the 3 14 certificate of release should not be executed and recorded. 3 15 If, prior to executing and recording the certificate of 3 16 release, the division receives written notification setting 3 17 forth a reason satisfactory to the division containing a 3 18 reason why the certificate of release should not be executed 3 19 and recorded by the division, the division shall not execute 3 20 and record the certificate of release. 3 21 3. CONTENTS. A certificate of release executed under this 3 22 section must contain substantially the information set forth 3 23 as follows: 3 24 a. The name of the mortgagor; the name of the original 3 25 mortgagee, and, if applicable, the mortgage servicer; the date 3 26 of the mortgage; the date of recording, including the volume 3 27 and page or other applicable recording information in the real 3 28 property records where the mortgage is recorded, and the same 3 29 information for the last recorded assignment of the mortgage. 3 30 b. A statement that the original mortgage principal was in 3 31 an amount of five hundred thousand dollars or less. 3 32 c. A statement that the person executing the certificate 3 33 of release is a duly authorized officer or employee of the 3 34 division. 3 35 d. A statement indicating one of the following: 4 1 (1) That the mortgage servicer provided a payoff statement 4 2 that was used to make payment, and that does not indicate that 4 3 the mortgage continues to secure any unpaid obligation due the 4 4 mortgagee or any unfunded commitment by the mortgagor to the 4 5 mortgagee. 4 6 (2) A statement that the certificate is a partial release 4 7 of the mortgage, the legal description of the property that 4 8 will be released from the mortgage, and the legal description 4 9 of the property that will continue to be subject to the 4 10 mortgage. 4 11 e. A statement that payment was made in accordance with 4 12 the payoff statement, and the date the payment was received by 4 13 the mortgagee or mortgage servicer, as evidenced by one or 4 14 more of the following in the records of the real estate lender 4 15 or closer or its agent: 4 16 (1) A bank check, certified check, escrow account check, 4 17 real estate broker trust account check, or attorney trust 4 18 account check that was negotiated by the mortgagee or mortgage 4 19 servicer. 4 20 (2) Other documentary evidence of payment to the mortgagee 4 21 or mortgage servicer. 4 22 f. A statement that more than thirty days have elapsed 4 23 since the date payment in accordance with the payoff statement 4 24 was sent. 4 25 g. A statement that the division has sent the thirty-day 4 26 notice required under subsection 2, paragraph "c", and that 4 27 thirty days have elapsed since the date the notice was sent. 4 28 h. A statement that the division has not received written 4 29 notification of any reason why the certificate of release 4 30 should not be executed and recorded after the expiration of 4 31 the thirty-day notice period under subsection 2, paragraph 4 32 "c". 4 33 4. EXECUTION. A certificate of release under this section 4 34 shall be executed and acknowledged in the same manner as 4 35 required by law for the execution of a deed. 5 1 5. EFFECT. 5 2 a. For purposes of a release or partial release of the 5 3 mortgage, a certificate of release executed under this section 5 4 that contains the information and statements required under 5 5 subsection 3 is prima facie evidence of the facts contained in 5 6 such release or partial release, is entitled to be recorded 5 7 with the county recorder where the mortgage is recorded, 5 8 operates as a release or partial release of the mortgage 5 9 described in the certificate of release, and may be relied 5 10 upon by any person who owns or subsequently acquires an 5 11 interest in the property released from the mortgage. The 5 12 county recorder shall rely upon the certificate of release to 5 13 release the mortgage. 5 14 b. Recording of a wrongful or erroneous certificate of 5 15 release by the division shall not relieve the mortgagor, or 5 16 the mortgagor's successors or assigns on the debt, from 5 17 personal liability on the loan or on other obligations secured 5 18 by the mortgage. 5 19 c. In addition to any other remedy provided by law, if the 5 20 division wrongfully or erroneously records a certificate of 5 21 release under this section, the division is liable to the 5 22 mortgagee and mortgage servicer for actual damages sustained 5 23 due to the recording of the certificate of release. 5 24 d. Upon payment of a claim relating to the recording of a 5 25 certificate of release, the division is subrogated to the 5 26 rights of the claimant against all persons relating to the 5 27 claim. 5 28 6. RECORDING. If a mortgage is recorded in more than one 5 29 county and a certificate of release or partial release is 5 30 recorded in one of them, a certified copy of the certificate 5 31 of release may be recorded in another county with the same 5 32 effect as the original. In all cases, the certificate of 5 33 release or partial release shall be entered and indexed in the 5 34 manner that a satisfaction of mortgage is entered and indexed. 5 35 7. FEE. The division may charge a reasonable fee for 6 1 services provided under this section. 6 2 8. PRIOR MORTGAGES. If the real estate lender or closer 6 3 has notified the division that a mortgage has been paid in 6 4 full by someone other than the real estate lender or closer, 6 5 or was paid by the real estate lender or closer under a 6 6 previous transaction, and a release has not been filed of 6 7 record, is defective, or is not from the appropriate person, 6 8 the division may execute and record a certificate of release 6 9 without certification by the real estate lender or closer that 6 10 payment was made pursuant to a payoff statement and the date 6 11 payment was received by the mortgagee. A certificate of 6 12 release filed pursuant to this subsection is subject to the 6 13 requirements of subsection 2, paragraph "c". 6 14 9. APPLICATION. This section applies only to a mortgage 6 15 in an original principal amount of five hundred thousand 6 16 dollars or less. 6 17 Sec. 2. NEW SECTION. 655.3 PENALTY FOR FAILURE TO 6 18 DISCHARGE. 6 19 If a mortgagee, or a mortgagee's personal representative or 6 20 assignee, upon full performance of the conditions of the 6 21 mortgage, fails to discharge such mortgage within thirty days 6 22 after a request for discharge and after tender of the 6 23 mortgagee's reasonable charges for such discharge, the 6 24 mortgagee is liable to the mortgagor and the mortgagor's heirs 6 25 or assigns, for all actual damages caused by such failure, 6 26 including reasonable attorney fees. A claim for such damages 6 27 may be asserted in an action for discharge of the mortgage. 6 28 If the defendant is not a resident of this state, such action 6 29 may be maintained upon the expiration of thirty days after the 6 30 conditions of the mortgage have been performed, without such 6 31 previous request or tender. 6 32 Sec. 3. Section 655.2, Code 1999, is repealed. 6 33 EXPLANATION 6 34 This bill creates new Code section 16.92 and provides that 6 35 a duly authorized officer or employee of the title guaranty 7 1 division in the Iowa finance authority may execute and record 7 2 a certificate of release in each county in which a mortgage is 7 3 recorded. The certificate of release may be filed by the 7 4 division if the real estate lender or closer certifies in 7 5 writing that the payoff statement either does not indicate 7 6 that the mortgage continues to secure an unpaid obligation due 7 7 the mortgagee or an unfunded commitment by the mortgagor to 7 8 the mortgagee, or contains the legal description of the 7 9 property to be released from the mortgage and the legal 7 10 description of the property that will continue to be subject 7 11 to the mortgage, that the payment was made in accordance with 7 12 the payoff statement, and that more than 30 days have elapsed 7 13 since the date the payment was sent; the division determines 7 14 that an effective satisfaction or release of the mortgage has 7 15 not been executed and recorded within 30 days after the date 7 16 payment was sent or otherwise made in accordance with a payoff 7 17 statement; and the division, at least 30 days prior to 7 18 executing the certificate of release, sends by certified mail, 7 19 to the last known address of the mortgage servicer, written 7 20 notice of its intention to execute and record a certificate of 7 21 release, including instructions to notify the division of any 7 22 reason why the certificate of release should not be executed 7 23 and recorded. The bill provides that if, prior to executing 7 24 and recording the certificate of release, the division 7 25 receives written notification setting forth a reason 7 26 satisfactory to the division why the certificate of release 7 27 should not be executed and recorded by the division, the 7 28 division shall not execute and record the certificate of 7 29 release. 7 30 The bill provides that a certificate of release filed by 7 31 the division is to be executed and acknowledged in the same 7 32 manner as required by law for the execution of a deed. The 7 33 bill provides that the recording of a wrongful or erroneous 7 34 certificate of release by the division does not relieve the 7 35 mortgagor, or the mortgagor's successors or assigns on the 8 1 debt, from personal liability on the loan or on other 8 2 obligations secured by the mortgage. Also, in addition to any 8 3 other remedy provided by law, if the division wrongfully or 8 4 erroneously records a certificate of release, the division is 8 5 liable to the mortgagee and mortgage servicer for actual 8 6 damages sustained due to the recording of the certificate of 8 7 release. 8 8 The bill provides that new Code section 16.92 applies only 8 9 to a mortgage in an original principal amount of $500,000 or 8 10 less. 8 11 The bill also repeals Code section 655.2, which provides a 8 12 penalty for a mortgagee, mortgagee's representative or 8 13 assignee, who fails to release a mortgage within 30 days after 8 14 being requested in writing after the mortgage has been 8 15 satisfied in full. Such person shall forfeit to the mortgagor 8 16 or any grantee of the property who has paid the mortgage, the 8 17 sum of $100 plus reasonable attorney fees incurred by the 8 18 mortgagor or grantee in securing the release of the mortgage. 8 19 New Code section 655.3 provides that if a mortgagee, or a 8 20 mortgagee's personal representative or assignee, upon full 8 21 performance of the conditions of the mortgage, fails to 8 22 discharge such mortgage within 30 days after a request for 8 23 discharge and after tender of the mortgagee's reasonable 8 24 charges for such discharge, the mortgagee is liable to the 8 25 mortgagor and the mortgagor's heirs or assigns, for all actual 8 26 damages caused by such failure, including reasonable attorney 8 27 fees. 8 28 LSB 1409HC 78 8 29 mj/gg/8
Text: HSB00167 Text: HSB00169 Text: HSB00100 - HSB00199 Text: HSB Index Bills and Amendments: General Index Bill History: General Index
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