South Carolina Amends Mortgage Satisfaction and Foreclosure Expedition
by: Louis Danastorg
House Bill 3134-Satisfaction of Mortgage
Recently, South Carolina’s legislature amended Section 29-3-330 of the South Carolina Code, relating to the methods by which certain parties may discharge or cancel a mortgage. A mortgagee of record, or its duly authorized representative, may satisfy or release a security instrument by any of the following methods:
1) A mortgagee under a written instrument, duly recorded, may present the security instrument to the Register of Deeds responsible for recording the security instrument. While in the presence of the Register, the mortgagee must write across the face of the security instrument: “The debt secured is paid in full and the lien of this instrument is satisfied”, or some similar language, and sign the instrument at the notation. The Register must witness the signature.
2) The satisfaction or release may be written upon or attached to the original security instrument, but once executed; the satisfaction or release must be recorded across the face of the original instrument.
3) The mortgagee of record may execute a satisfaction or release; however, any person executing a false satisfaction or release is guilty of perjury and must be liable for damages that any person may sustain as result, including reasonable attorney’s fees. The mortgagee must use language substantially similar to the sample instrument of satisfaction provided in Section 29-3-330(3) of the South Carolina Code.
4) If the security instrument was recorded in counterparts, the original instrument does not need to be presented. In this situation, the satisfaction or release may be evidenced by an instrument of satisfaction or release, which may be executed in counterparts. The Register shall record the instrument of satisfaction or release, or its counterpart, upon presentation.
5) Any attorney licensed to practice in South Carolina may record, or cause to be recorded, a written affidavit, which must have been duly executed and acknowledged before two witnesses. The affidavit must state that any outstanding balance has been paid and evidence of the payment exists. The Register must record the affidavit upon presentation, and it will serve as notice of satisfaction of the mortgage and release of the lien. The mortgagee must use language substantially similar to the sample satisfaction affidavit provided in Section 29-3-330(5) of the South Carolina Code. Any attorney signing a false instrument of satisfaction or release is guilty of perjury.
Senate Bill 1007- Expedition of Mortgage Foreclosure
South Carolina’s Senate ratified a bill on May 29th to add Section 29-3-625 to the South Carolina Code, providing a process by which mortgagees may expedite mortgage foreclosures of abandoned properties. A mortgagee may petition that court for an expedited judgment of foreclosure and sale of real property that is abandoned after submitting a motion to expedite foreclosure and sale. The motion must be supported by affidavit that establishes the facts demonstrating the property is abandoned, and the mortgagee may file any time after the Order of Reference has been filed. The mortgagee must notify each defendant that it is seeking a judgment and order of foreclosure on the court appointed date.
A motion to expedite foreclosure and sale may be heard by the master-in-equity, special referee, or circuit court judge; the motion is designated a priority matter and should be heard as soon as possible. After a hearing, the court shall grant the motion and enter a judgment of foreclosure and sale if it finds, by clear and convincing evidence, that the property is indeed abandoned and testimony supports an entry of a final judgment of foreclosure and sale. The motion must be denied if the court finds the property not to be abandoned, or any defendant files a written objection that asserts a valid reason to preclude the entry of a judgment of foreclosure and sale. If a motion to expedite foreclosure and sale is denied, the court has the discretion to direct the action to continue pursuant standard foreclosure procedure.
Property in South Carolina shall be considered abandoned if it is unoccupied, and at least two of the following conditions exist:
a) Entrances are boarded up or multiple window panes are damaged;
b) Doors are broken or continuously unlocked;
c) Unhealthy substances and materials have accumulated on the property;
d) Utility companies have terminated gas, electric, or water services for failure to pay;
e) Public health and welfare risks due to vandalism, loitering, criminal behavior, destruction or
deterioration of the property;
f) The property owner had received notice during the preceding year of a building code violation that has gone uncorrected;
g) An order has been given by a government authority declaring the property unfit for occupancy;
h) Any mortgagor issues a written statement expressing the clear intent of all mortgagors to abandon the property;
i) Neighbors, delivery personnel, or government employees provide written statements that the property is abandoned;
j) Any other indicia of abandonment, including the property being a vacant, unimproved land in need of maintenance, repair, or securing.
Real property must not be considered abandoned if there exists on the property an unoccupied building presently under construction, which is proceeding diligently and in compliance with all applicable building regulations, a seasonally occupied building, a secure building that is the subject of an ownership or probate dispute, or a building owned by a deceased person with identifiable heirs.
About the Author:
Anna DeSimone founded Bankers Advisory in 1986 and is a nationally recognized authority in residential mortgage lending. She has received numerous industry awards and has authored more than 40 best practices guides and hundreds of articles.
S.C.'s new "expedited foreclosure" law only allows lenders to process foreclosures faster, whether the property is abandoned or not.
I lived (as a renter) in a home under foreclosure and the lender obtained an expedited foreclosure without anyone ever coming to the house to even ask if the homeowner was available or ascertain if the property was abandoned.