House Study Bill 597 - Introduced HOUSE FILE _____ BY (PROPOSED COMMITTEE ON JUDICIARY BILL BY CHAIRPERSON SWAIM) A BILL FOR An Act relating to judgment liens on homesteads. 1 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 2 TLSB 5181YC (2) 83 rh/nh

H.F. _____ Section 1. Section 624.23, subsection 2, Code 2009, is 1 amended to read as follows: 2 2. a. Judgment liens described in subsection 1 do not 3 remain a lien upon attach to real estate of the defendant, 4 platted occupied as a homestead pursuant to section 5 561.4 , chapter 561, except as provided in section 561.21 or if 6 the real estate claimed as a homestead exceeds the limitations 7 prescribed in sections 561.1 through 561.3. 8 b. A claim of lien against real estate claimed as a 9 homestead is barred unless execution is levied within thirty 10 days of the time the defendant , or the defendant’s agent , 11 or a person with an interest in the real estate has served 12 written demand on the owner of the judgment. The demand 13 shall state that the lien and all benefits derived from the 14 lien as to the real estate platted as alleged to be or to 15 have been a homestead shall be forfeited unless the owner 16 of the judgment levies execution against that real estate 17 within thirty days from the date of service of the demand. 18 The demand shall contain an affidavit setting forth facts 19 indicating why the judgment is not believed to be a lien 20 against the real estate. A warranty of title by a former 21 occupying homeowner in a conveyance for value constitutes a 22 claim of exemption against all judgments against the current 23 homeowner or the current homeowner’s spouse not specifically 24 exempted in the conveyance. Written demand shall be served 25 in any manner authorized for service of original notice under 26 the Iowa rules of civil procedure or in a manner provided 27 in section 654.4A, subsections 1 through 3 . A copy of the 28 written demand and proof of service of the written demand 29 shall be recorded filed in the office of the county recorder 30 of the county where the real estate platted as a homestead is 31 located court file of the case in which the judgment giving 32 rise to the alleged lien was entered . 33 c. A party serving a written demand under this subsection 34 may obtain an immediate court order releasing the claimed lien 35 -1- LSB 5181YC (2) 83 rh/nh 1/ 3

H.F. _____ by posting with the clerk of court a cash bond in an amount of 1 at least one hundred twenty-five percent of the outstanding 2 balance owed on the judgment. A copy of the court order shall 3 be served along with a written demand under this subsection. 4 Thereafter, any execution on the judgment shall be against the 5 bond, subject to all claims and defenses which the moving party 6 had against the execution against the real estate, including 7 but not limited to a lack of equity in the property to support 8 the lien in its proper priority. The bond shall be released 9 by the clerk of court upon demand of its principal or surety 10 if no execution is ordered on the judgment within thirty days 11 of completion of service of the written demand under this 12 subsection. 13 EXPLANATION 14 This bill specifies that a judgment lien does not attach to 15 real estate claimed as a homestead except as provided in Code 16 section 561.21 (certain prior debts, certain debts created by 17 written contract, certain home improvement debts, and if there 18 is no survivor or issue, certain debts to which the homestead 19 might have been subject to if it had never been held as a 20 homestead) or if the real estate claimed as a homestead exceeds 21 the physical limitations prescribed in Code sections 561.1 22 through 561.3. 23 The bill provides that a warranty of title by a former 24 occupying homeowner in a conveyance for value constitutes a 25 claim of exemption against all judgments against the current 26 homeowner or the current homeowner’s spouse not specifically 27 exempted in the conveyance. 28 The bill provides that a claim of lien against a homestead 29 is barred unless execution is levied within 30 days of the 30 time the defendant, the defendant’s agent, or a person with an 31 interest in the real estate has served written demand on the 32 owner of the judgment accompanied by an affidavit setting forth 33 facts indicating why the judgment is not believed to be a lien 34 against the real estate. The written demand shall be served in 35 -2- LSB 5181YC (2) 83 rh/nh 2/ 3

H.F. _____ any manner authorized for service of original notice under the 1 Iowa rules of civil procedure or in a manner provided in Code 2 section 654.4A, subsections 1 through 3 (service of process 3 procedures relating to in rem relief). 4 The bill provides that a party serving a written demand 5 under the bill may obtain an immediate court order releasing 6 the claimed lien by posting a cash bond in an amount of at least 7 125 percent of the outstanding balance owed on the judgment. 8 Thereafter, any execution on the judgment shall be against the 9 bond, subject to all claims and defenses which the moving party 10 had against the execution against the real estate, including 11 but not limited to a lack of equity in the property to support 12 the lien in its proper priority. The bill requires the bond 13 to be released by the clerk of court upon demand of the bond’s 14 principal or surety if no execution is ordered on the judgment 15 within 30 days of completion of service of the written demand 16 under the bill. 17 -3- LSB 5181YC (2) 83 rh/nh 3/ 3