16.92 - REAL ESTATE TRANSFER -- MORTGAGE RELEASE CERTIFICATE.

        16.92  REAL ESTATE TRANSFER -- MORTGAGE RELEASE
      CERTIFICATE.
         1.  Definitions.  As used in this section, unless the context
      otherwise requires:
         a.  "Division" means the title guaranty division in the Iowa
      finance authority.
         b.  "Division board" means the board of directors of the title
      guaranty division of the Iowa finance authority.
         c.  "Mortgage" means a mortgage or mortgage lien on an
      interest in real property in this state given to secure a loan in an
      original principal amount equal to or less than the maximum amount as
      determined by the division board.
         d.  "Mortgagee" means the grantee of a mortgage.  If a
      mortgage has been assigned of record, the mortgagee is the last
      person to whom the mortgage is assigned of record.
         e.  "Mortgage servicer" means the mortgagee or a person other
      than the mortgagee to whom a mortgagor or the mortgagor's successor
      in interest is instructed by the mortgagee to send payments on a loan
      secured by the mortgage.  A person transmitting a payoff statement
      for a mortgage is the mortgage servicer for purposes of such
      mortgage.
         f.  "Mortgagor" means the grantor of a mortgage.
         g.  "Participating abstractor" means an abstractor
      participating in the title guaranty program.
         h.  "Payoff statement" means a written statement furnished by
      the mortgage servicer which sets forth all of the following:
         (1)  The unpaid balance of the loan secured by a mortgage,
      including principal, interest, and any other charges properly due
      under or secured by the mortgage, or the amount required to be paid
      in order to release or partially release the mortgage.
         (2)  Interest on a per-day basis for an amount set forth pursuant
      to subparagraph (1).
         (3)  The address where payment is to be sent or other specific
      instructions for making a payment.
         (4)  If after payment of the unpaid balance of the loan secured by
      the mortgage, the mortgage continues to secure any unpaid obligation
      due the mortgagee or any unfunded commitment by the mortgagor to the
      mortgagee, the legal description of the property that will be
      released from the mortgage.
         i.  "Real estate lender or closer" means a person licensed to
      regularly lend moneys to be secured by a mortgage on real property in
      this state, a licensed real estate broker, a licensed attorney, or a
      participating abstractor.
         2.  Execution of certificate of release.  A duly authorized
      officer or employee of the division may execute and record a
      certificate of release in the real property records of each county in
      which a mortgage is recorded as provided in this section if all of
      the following are satisfied:
         a.  The real estate lender or closer has certified in writing
      to the division all of the following:
         (1)  That the payoff statement satisfies one of the following:
         (a)  The statement does not indicate that the mortgage continues
      to secure an unpaid obligation due the mortgagee or an unfunded
      commitment by the mortgagor to the mortgagee.
         (b)  The statement contains the legal description of the property
      to be released from the mortgage.
         (2)  That payment was made in accordance with the payoff
      statement, including a statement as to the date the payment was
      received by the mortgagee or mortgage servicer, as evidenced by one
      or more of the following in the records of the real estate lender or
      closer or its agent:
         (a)  A bank check, certified check, escrow account check, real
      estate broker trust account check, or attorney trust account check
      that was negotiated by the mortgagee or mortgage servicer.
         (b)  Other documentary evidence of payment to the mortgagee or
      mortgage servicer.
         (3)  That more than thirty days have elapsed since the date the
      payment was sent.
         b.  The division determines that an effective satisfaction or
      release of the mortgage has not been executed and recorded within
      thirty days after the date payment was sent or otherwise made in
      accordance with a payoff statement.
         c.  The division, at least thirty days prior to executing the
      certificate of release, sends by certified mail, to the last known
      address of the mortgage servicer, written notice of its intention to
      execute and record a certificate of release pursuant to this section
      after expiration of the thirty-day period following the sending of
      such notice, including instructions to notify the division of any
      reason why the certificate of release should not be executed and
      recorded.  If, prior to executing and recording the certificate of
      release, the division receives written notification setting forth a
      reason satisfactory to the division why the certificate of release
      should not be executed and recorded by the division, the division
      shall not execute and record the certificate of release.
         3.  Contents.  A certificate of release executed under this
      section must contain substantially the information set forth as
      follows:
         a.  The name of the mortgagor; the name of the original
      mortgagee, and, if applicable, the mortgage servicer; the date of the
      mortgage; the date of recording, including the volume and page or
      other applicable recording information in the real property records
      where the mortgage is recorded, and the same information for the last
      recorded assignment of the mortgage.
         b.  A statement that the original mortgage principal was in an
      amount equal to or less than the maximum amount as determined by the
      division board and adopted by the authority pursuant to chapter 17A.

         c.  A statement that the person executing the certificate of
      release is a duly authorized officer or employee of the division.
         d.  A statement indicating one of the following:
         (1)  That the mortgage servicer provided a payoff statement that
      was used to make payment, and that does not indicate that the
      mortgage continues to secure any unpaid obligation due the mortgagee
      or any unfunded commitment by the mortgagor to the mortgagee.
         (2)  A statement that the certificate is a partial release of the
      mortgage and the legal description of the property that will be
      released from the mortgage.
         e.  A statement that payment was made in accordance with the
      payoff statement, and the date the payment was received by the
      mortgagee or mortgage servicer, as evidenced by one or more of the
      following in the records of the real estate lender or closer or its
      agent:
         (1)  A bank check, certified check, escrow account check, real
      estate broker trust account check, or attorney trust account check
      that was negotiated by the mortgagee or mortgage servicer.
         (2)  Other documentary evidence of payment to the mortgagee or
      mortgage servicer.
         f.  A statement that more than thirty days have elapsed since
      the date payment in accordance with the payoff statement was sent.
         g.  A statement that the division has sent the thirty-day
      notice required under subsection 2, paragraph "c", and that
      thirty days have elapsed since the date the notice was sent.
         h.  A statement that the division has not received written
      notification of any reason satisfactory to the division why the
      certificate of release should not be executed and recorded after the
      expiration of the thirty-day notice period under subsection 2,
      paragraph "c".
         4.  Execution.  A certificate of release under this section
      shall be executed and acknowledged in the same manner as required by
      law for the execution of a deed.
         5.  Effect.
         a.  For purposes of a release or partial release of the
      mortgage, a certificate of release executed under this section that
      contains the information and statements required under subsection 3
      is prima facie evidence of the facts contained in such release or
      partial release, is entitled to be recorded with the county recorder
      where the mortgage is recorded, operates as a release or partial
      release of the mortgage described in the certificate of release, and
      may be relied upon by any person who owns or subsequently acquires an
      interest in the property released from the mortgage.  The county
      recorder shall rely upon the certificate of release to release the
      mortgage.
         b.  Recording of a wrongful or erroneous certificate of
      release by the division shall not relieve the mortgagor, or the
      mortgagor's successors or assigns on the debt, from personal
      liability on the loan or on other obligations secured by the
      mortgage.
         c.  In addition to any other remedy provided by law, if the
      division through an act of negligence wrongfully or erroneously
      records a certificate of release under this section, the division is
      liable to the mortgagee and mortgage servicer for actual damages
      sustained due to the recording of the certificate of release.
         d.  Upon payment of a claim relating to the recording of a
      certificate of release, the division is subrogated to the rights of
      the claimant against all persons relating to the claim.
         6.  Recording.  If a mortgage is recorded in more than one
      county and a certificate of release or partial release is recorded in
      one of them, a certified copy of the certificate of release may be
      recorded in another county with the same effect as the original.  In
      all cases, the certificate of release or partial release shall be
      entered and indexed in the manner that a satisfaction of mortgage is
      entered and indexed.
         7.  Prior mortgages.
         a.  If the real estate lender or closer has notified the
      division that a mortgage has been paid in full by someone other than
      the real estate lender or closer, or was paid by the real estate
      lender or closer under a previous transaction, and an effective
      release has not been filed of record, the division may execute and
      record a certificate of release without certification by the real
      estate lender or closer that payment was made pursuant to a payoff
      statement and the date payment was received by the mortgagee.  A
      certificate of release filed pursuant to this subsection is subject
      to the requirements of subsection 2, paragraph "c".
         b.  For purposes of this subsection, an effective release has
      not been filed of record if it appears that a mortgagee in the record
      chain of title to the mortgage has not, either on the mortgagee's own
      behalf or by the mortgagee's duly appointed servicer or attorney in
      fact as established of record by a filed servicing agreement or power
      of attorney, filed of record either an assignment of the mortgage to
      another mortgagee in the record chain of title to the mortgage or a
      release of the mortgagee's interest in the mortgage.  For the
      purposes of this subsection and subsection 2, paragraph "c",
      "mortgage servicer" includes a mortgagee for which an effective
      release has not been filed of record as provided in this paragraph.
         8.  Application.  This section applies only to a mortgage in
      an original principal amount equal to or less than the maximum amount
      as determined by the division board and adopted by the authority
      pursuant to chapter 17A.  
         Section History: Recent Form
         99 Acts, ch 54, §1; 2000 Acts, ch 1166, §2--5; 2001 Acts, ch 24,
      §15; 2005 Acts, ch 26, §1, 2; 2007 Acts, ch 52, §1--4; 2008 Acts, ch
      1191, §32