HB111 Alabama 2010 Session

Summary

Primary Sponsor

James E. Buskey

Democrat

Session

Regular Session 2010

Title

Uniform Residential Mortgage Satisfaction Act, uniform method for clearing residential land titles for subsequent transactions, Chapter 10B, Title 35 added, Secs. 35-10-26, 35-10-30 am'd.

Summary

HB111 would create the Alabama Uniform Residential Mortgage Satisfaction Act to standardize how residential mortgage satisfactions clear from land records, require prompt payoff statements and recordings, and provide remedies for errors.

What This Bill Does

It adds a new Chapter 10B to Title 35 to establish a uniform process for payoff statements and mortgage satisfactions. It requires secured creditors to respond to payoff requests within 30 days and to record satisfactions within 30 days after payment, with damages and attorney's fees available for noncompliance. It creates self-help tools such as an Affidavit of Satisfaction and a Satisfaction Agent, and a Document of Rescission to correct erroneous recordings and limit liability. It also revises related law to ensure a mortgage is only satisfied when all debts and future obligations are fully resolved.

Who It Affects

• Landowners or other entitled persons who want to clear and transfer title on residential property; they can request payoff statements, pursue timely action from creditors, and use new remedies if creditors fail to comply.
• Secured creditors and their agents (banks, title insurers, attorneys) who hold or service residential mortgage loans; they must provide payoff statements, record satisfactions promptly, may face damages and fees for failures, and may utilize affidavits and satisfaction agents in the process.

Key Provisions

• Creates Chapter 10B (Alabama Uniform Residential Mortgage Satisfaction Act) in Title 35 and defines key terms (e.g., entitled person, secured creditor, payoff statement, satisfaction, satisfaction agent).
• Payoff statement process: entitled person may request a payoff statement; creditor must respond within 30 days after notification and send the statement to the designated recipient.
• Notification methods: payoff notices may be sent by mail, fax, or email if authorized, and must include identity, authorization, recipient address, and enough information to identify the obligation and property.
• Recordation requirement: secured creditors must record mortgage satisfactions within 30 days after payment; failure to do so can result in damages (actual damages plus $500) and attorneys’ fees, with limited liability protections if compliance was reasonable and in good faith.
• Remedies for errors: a Document of Rescission can correct erroneous recordings; an Affidavit of Satisfaction can be submitted by a satisfaction agent or title insurer/attorney to close the matter when ownership has not yet transferred and the error is identified.
• Affidavit of Satisfaction: satisfaction agents or attorneys may sign/submit affidavits under defined conditions, including notice to the assignee if the instrument has been assigned, and must follow prescribed content/form.
• Liability and procedures: the act sets specific liability rules for satisfaction agents and creditors, including circumstances where punitive or additional damages may be awarded and the right to recover attorney’s fees; reasonable procedures and good-faith compliance are recognized as defenses.
• Related amendments: the act amends Sections 35-10-26 and 35-10-30 to require satisfaction only after all indebtedness or extend-value obligations are cleared and to outline penalties for failure to enter satisfaction records.

AI-generated summary using openai/gpt-5-nano on Feb 24, 2026. May contain errors — refer to the official bill text for accuracy.

Subjects

Property, Real and Personal