HB382 Alabama 2012 Session

Summary

Primary Sponsor

Victor Gaston

Republican

Co-Sponsors

Kurt WallaceRichard BaughnWes LongEd HenryPaul W. LeeWilliam RobertsKerry RichMary Sue McClurkinJamie IsonChad FincherHarry ShiverJoe HubbardMike BallDavid Sessions

Session

Regular Session 2012

Title

Mortgages, Alabama Residential Mortgage Satisfaction Act, provides for timely payoff statements and timely recording of mortgage satisfaction, Secs. 35-10-26, 35-10-30 am'd

Summary

HB382 creates the Alabama Uniform Residential Mortgage Satisfaction Act to ensure timely payoff statements and recording of mortgage satisfactions for residential property, with remedies for noncompliance.

What This Bill Does

It applies to residential mortgages on properties with 1–4 units. It requires secured creditors to issue payoff statements within 14 days of proper notification and to include key payoff details; it also requires recording of satisfactions within 30 days after full payment, with damages available if not done. It creates a satisfaction agent process (via affidavits) to clear title, allows a Document of Rescission to correct erroneous recordings, and amends existing law to align with these rules; the act takes effect March 1, 2013.

Who It Affects

• Mortgagors/entitled persons (homeowners) who want timely payoff statements, faster title clearance, and potential damages if lenders fail to comply.
• Secured creditors (lenders, including title insurance companies and satisfaction agents) who must provide payoff statements, record satisfactions, may face penalties for noncompliance, and participate in the affidavit/satisfaction agent processes.

Key Provisions

• Establishes the Alabama Residential Mortgage Satisfaction Act for residential real property (1–4 units) and defines key terms (entitled person, secured creditor, security instrument, satisfaction agent).
• Requires payoff statements within 14 days of proper notification, including date, payoff amount, per diem, payment methods, and special rules for equity lines.
• Requires recording of mortgage satisfactions within 30 days of full payment; provides penalties (e.g., $500) for failing to record after a written request and allows certain defenses or exceptions for reasonable procedures or bona fide errors.
• Creates a satisfaction agent role (title insurance company or licensed attorney) to sign and file affidavits of satisfaction; outlines notice and affidavit content and requirements; recording ends the security interest but does not erase related debt obligations.
• Allows remedies for erroneous recordings (damages) and introduces a Document of Rescission to limit liability and correct mistakes; amends Sections 35-10-26 and 35-10-30 to reflect new rules.
• Effective date: March 1, 2013.

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

Subjects

Mortgages