Assignment of Mortgage by Individual Mortgage Holder
Assignments Generally: Lenders, or holders
of mortgages or deeds of trust, often assign mortgages or deeds of trust
to other lenders, or third parties. When this is done the assignee
(person who received the assignment) steps into the place of the original
lender or assignor. To effectuate an assignment, the general rules
is that the assignment must be in proper written format and recorded to
provide notice of the assignment.
Satisfactions Generally: Once a mortgage
or deed of trust is paid, the holder of the mortgage is required to satisfy
the mortgage or deed of trust of record to show that the mortgage or deed
of trust is no longer a lien on the property. The general rule is that
the satisfaction must be in proper written format and recorded to provide
notice of the satisfaction. If the lender fails to record a satisfaction
within set time limits, the lender may be responsible for damages set by
statute for failure to timely cancel the lien. Depending on your state,
a satisfaction may be called a Satisfaction, Cancellation, or Reconveyance.
Some states still recognize marginal satisfaction but this is slowly being
phased out. A marginal satisfaction is where the holder of the mortgage
physically goes to the recording office and enters a satisfaction on the
face of the the recorded mortgage, which is attested by the clerk.
Delaware Law
Assignment: An assignment of a mortgage
or any sealed instrument attested by 1 creditable witness shall be valid
and effectual to convey all the right and interests of the assignor. Recording
is not required, but recommended in order to avoid complications.
Demand to Satisfy: Upon the payoff of the
mortgage, the mortgagor may request that the mortgagee satisfy the mortgage
of record, whereupon the mortgagee shall do so within 60 days, or face
liability (see Penalty, below).
Recording Satisfaction: When a debt or
duty, secured by a mortgage, or conveyance in the nature of a mortgage
is satisified or performed, the person or corporation in whom the title
under such mortgage or conveyance is, shall upon the reasonable request
and at the proper cost of the mortgagor, his heirs or assigns, execute
and acknowledge a sufficient reconveyance of the premises contained in
such mortgage, or conveyance in the nature of a mortgage.
Penalty: Whoever, being the holder of a
mortgage, wilfully fails to satisfy a mortgage upon the record as required
shall be fined not more than $1,000 for each such failure. The Recorder
of Deeds or the mortgage commissioner of the county in which any mortgage
is recorded that has been satisfied or performed shall file a complaint
with the Attorney General's Office in said county against any mortgage
holder who has not satisfied of record said mortgage within 60 days of
its satisfaction or performance.
Acknowledgment: An assignment or satisfaction
must contain a proper Delaware acknowledgment, or other acknowledgment
approved by Statute.
Delaware Statutes
§ 2109. Assignment of mortgages.
(a) An assignment of a mortgage or any sealed instrument attested
by 1 creditable witness shall be valid and effectual to convey all the
right and interests of the assignor.
(b) All assignments of mortgages or any sealed instruments
heretofore made in the presence of 1 witness and all satisfactions
made by assignees in such assignments are made good and valid.
§ 2111. Satisfaction of mortgages; penalty; enforcement
in Superior Court.
(a) Whenever the debt or duty secured by a mortgage or conveyance
in the nature of a mortgage affecting properties in New Castle, Kent and
Sussex Counties is satisfied or performed, the legal holder of such mortgage
or conveyance at the time the satisfaction or performance is completed
shall,
forthwith, after satisfaction or performance is completed, cause an entry
of such satisfaction or performance to be made upon the record by the
procedure enumerated in this subsection. The fee for entering such satisfaction
or performance upon the record shall be paid by the debtor or obligor unless
the mortgage or conveyance provides otherwise. (1) A satisfaction of a
mortgage or conveyance shall be made by recordation of either a satisfaction
piece, if the instrument is presented in substantially the same form as
set out in subsection (b) of this section and acknowledged in the same
manner as provided by law for the acknowledgment of deeds, or an attorney's
affidavit pursuant to § 2120 of this title. The satisfaction piece
shall be presented to the Recorder, and the Recorder shall accept such
document for recordation providing such document conforms to the requirements
set out in subsection (b) of this section. (2) If a full or partial release
of the mortgage or conveyance is recorded, the recorder of deeds shall
place a reference to a book and page number in the indices as to where
the release is recorded.
...
(c) Each Recorder shall either create and maintain a separate
index and record of the recording of documents which are authorized to
be recorded by this chapter including, but not limited to, powers of attorney
to satisfy mortgages, satisfaction pieces, partial and complete releases
of mortgages and security interests or index the same in the index
used for recorded mortgages. If the Recorder creates a separate index,
it may be called the Release and satisfaction Index, which
shall reference the mortgagor, mortgagee, record book and page of the mortgage
being released or satisfied and the address or lot number, if any,
of the property being released or satisfied. The Recorder may also
maintain a separate record of said instruments and shall not be required
to maintain other than a micrographic or electronic record of said
instruments.
(d) Whoever, being the holder of a mortgage, wilfully fails
to satisfy a mortgage upon the record as required by subsection (a)
of this section shall be fined not more than $1,000 for each such failure.
(e) The Recorder of Deeds or the mortgage commissioner of
the county in which any mortgage is recorded that has been satisfied or
performed shall file a complaint with the Attorney General's Office in
said county against any mortgage holder who has not satisfied of record
said mortgage within 60 days of its satisfaction or performance.
(f) The Superior Court shall have jurisdiction of offenses
under this section.
§ 2113. Effect of entry of satisfaction. An entry of
satisfaction or performance made in accordance with this chapter shall
extinguish the mortgage or conveyance, and the effect shall be the
same as if such mortgage or conveyance had not been made.
§ 2114. Damages for nonentry of satisfaction. If any
person commits a default under § 2111 of this title, such person,
his executors or administrators, or if it is a corporation, such
corporation, in addition to the other penalties provided for shall be liable
to the party by or on whose behalf the satisfaction or performance
has been made or completed, in damages to be recovered by a civil
action. The damages shall not be less than $10 nor more than $500, except
when special damage to a larger amount is alleged in the complaint and
proved.
§ 2116. Reconveyance upon satisfaction or performance. When
a debt or duty, secured by a mortgage, or conveyance in the nature of a
mortgage is satisified or performed, the person or corporation in whom
the title under such mortgage or conveyance is, shall upon the reasonable
request and at the proper cost of the mortgagor, his heirs or assigns,
execute
and acknowledge a sufficient reconveyance of the premises contained
in such mortgage, or conveyance in the nature of a mortgage.
