04 Feb Ohio Legislative Update
The Ohio legislature recently amended the law related to the timing requirements for recording a release of mortgage, effective March 23, 2015.
OHIO HOUSE BILL 201
Within ninety days from the date of the satisfaction of a mortgage, the lender must record a release of the mortgage evidencing the satisfaction. If the lender fails to do so, the borrower of the unrecorded satisfaction and the current owner of the real property to which the mortgage pertains may recover, in a civil action, damages of $250. This does not preclude or affect any other legal remedies or damages that may be available to the borrower.
If after the expiration of the ninety-day period the satisfaction of mortgage remains unrecorded, the current owner of the real property must provide the lender written notice of the failure to enter the release of the mortgage of record. The notice must be in substantially the following form:
“OHIO LAW REQUIRES A MORTGAGEE, WHETHER THE ORIGINAL MORTGAGEE OR ANY SUCCESSOR TO THE INTEREST OF THE ORIGINAL MORTGAGEE, TO RECORD A RELEASE OF A MORTGAGE EVIDENCING ITS SATISFACTION IN THE APPROPRIATE COUNTY RECORDER’S OFFICE AND TO PAY ANY FEES REQUIRED FOR THE RECORDING WITHIN A CERTAIN TIME PERIOD (Name of mortgagor’s) MORTGAGE LOAN, (loan number or other loan identification), FOR PROPERTY LOCATED AT (property address), WAS SATISFIED ON (date of satisfaction).”
Within fifteen days after delivery of the above notice, the lender must record a release of the mortgage evidencing the fact of its satisfaction in the appropriate county recorder’s office and pay any fees required for the recording. The lender may, by contract with the borrower or current owner of the real property, recover the cost of the fees required for the recording.
If the lender fails to file the satisfaction after receiving the above notice, the current owner of the real property may recover, in a civil action, reasonable attorneys’ fees and costs incurred in such an action or otherwise to obtain the recording of a satisfaction of mortgage plus damages of $100 for each day of noncompliance, not to exceed $5,000 in total damages. This does not preclude or affect any other legal remedies or damages that may be available to the current owner.
A lender that records a release of a satisfaction within the time periods required will not be in violation of this law, or subject to damages or fees, due to the failure of a county recorder to timely process the release of mortgage.
A current owner may combine the civil actions described in this law by bringing one action to collect for both damages or may bring separate actions.
“Mortgagee” includes the original mortgagee or any successor to or assignee of the original mortgagee.
“Satisfaction” means that the obligation secured by a mortgage has been paid in full and the underlying obligation terminated, with no opportunities for future advancements.
With respect to an unreleased residential mortgage that has been satisfied, but not recorded, prior to March 23, 2015, the lender will be subject to a civil action or damages as described above for failure to comply with the requirement to record within ninety days. If such a mortgage was satisfied more than ninety days prior to March 23, 2015, the current owner of the real property to which the mortgage pertains must provide the lender the written notice described not sooner than on March 23, 2015 and may recover damages in a civil action for failure to comply with the recording requirement. If such a mortgage was satisfied less than ninety days prior to March 23, 2015, the current owner must provide the lender the written notice not sooner than on the ninetieth day after the mortgage was satisfied and may recover damages in a civil action for failure to comply with the recording requirements.