SB127 Alabama 2019 Session

Updated Apr 26, 2021

Senate Bill

Expired

Current Status

Regular Session 2019

Session

1

Sponsor

Summary

Primary Sponsor: Shay Shelnutt Senator
Republican
Session: Regular Session 2019
Title: Future Advance mortgages, provide that future indebtedness secures when mortgage created, Sec. 35-10-120 to 35-10-124, inclusive, added.
Description: Under current law, a future advance mortgage, which is created upon its execution, may secure funds advanced at the time the mortgage is executed as well as funds advanced in the future. A recent Alabama Supreme Court opinion held that a future advance mortgage, although recorded, is not created until the lender advances funds under the loan secured by the mortgage, thus potentially eliminating the priority a future advance mortgage has over subsequently recorded mortgages or liens.
This bill would create the Future Advance Mortgage Protection Act.
This bill would clarify that a mortgage may secure not only existing indebtedness but also future advances to the same extent as if the future advances were made at the same time the mortgage was created.
This bill would also provide that this bill would apply prospectively to mortgages created in the future, as well as retrospectively to existing mortgages.
Subjects: Mortgages

Fiscal Responsibility and Economic Development first Substitute Offered

Pending third reading on day 7 Favorable from Fiscal Responsibility and Economic Development with 1 substitute

Read for the second time and placed on the calendar with 1 substitute and

Read for the first time and referred to the Senate committee on Fiscal Responsibility and Economic Development