:: Massachusettes Releases Statute Compliance Update

May 18, 2009.  In regards to mortgage lien releases in the State of Massachusetts, Nationwide Title Clearing recently reviewed our client practices and statutes of this State.

Based on this review, in order to offer you protection from potential State fines, we are required to make some procedural changes.

Part II. Real and Personal Property and Domestic Relations, Title I. Title To Real Property, Chapter 183. Alienation of Land, Discharge of Mortgages

Chapter 183: Section 55. Discharge of mortgage; contents and recording;
liability for failure to discharge or negligent discharge; affidavits 

[Text of section applicable as provided by 2006, 63, Sec. 8.]

Section 55. (a)(1) A mortgagee, mortgage servicer or note holder who receives full payment and satisfaction of the conditions of a mortgage shall, within 45 days of receipt of payment, (i) cause to be recorded a duly executed and acknowledged discharge that conforms with subsection (b) and provide to the closing attorney, settlement agent or other person transmitting the payoff a copy of the discharge, together with the recording information therefore, or (ii) provide to the closing attorney, settlement agent or other person transmitting the payoff a duly executed and acknowledged discharge, also so conforming, which documents, in either case, shall be provided to the closing attorney, settlement agent or other person, irrespective of whether the mortgagee, mortgage servicer or note holder has withheld the fee for recording the discharge. Merely providing a copy of the discharge and evidence that the discharge was sent to a registry of deeds for recording shall not constitute compliance with this section unless the recording information required herein is noted on the copy...

(Click here to read full statute)

The statute states the mortgage servicer must "cause [a discharge] to be recorded" "within 45 days of receipt of payment."

Per this statute the closing attorney, settlement agent or other person transmitting the payoff needs to either a) receive a recordable release for them to record or b) receive a recorded copy of the release or c) receive a letter with the recording information of the release within the 45 day timeframe.

New Procedure
Nationwide Title Clearing will now put in place a full procedure in order to offer protection and assist in safeguarding our clients from mortgage lien release penalties for the State of Massachusetts:

NTC will send to the County Recorders in Massachusetts the following by 2nd Day Air:
a)    Mortgage Lien Release to be recorded
b)    Any applicable Recording fees
c)    A 2nd Day Air envelope for the County Recorder to send the recorded release back to NTC.

If we do not receive the recorded release back 10-15 days prior to the deadline, NTC will automatically begin follow-up. A nominal follow-up fee will be charged, as well as any applicable pass-through costs to obtain the release or the release recording information.

Once the recorded release is received by NTC, this document will be scanned and indexed for your access.  If only release recording information can be obtained from follow up, a letter will be prepared which contains this information. It will then be sent to the closing attorney, settlement agent or other person transmitting the payoff via independent courier 2nd Day Air.

The closing attorney, settlement agent or other person transmitting the payoff needs to be provided as part of the initial download. If this information is not provided at that time, we will search for the information in the documents provided and will charge a manual download fee as covered in your contract. It is recommended that the payoff letter/transmittal information be provided in the documents sent to NTC for release processing.

If we do not have the closing attorney, settlement agent or other person transmitting the payoff through documents or download, that loan will automatically default to send the recorded release or letter with recording information to the Homeowner/Borrower instead.

If the release defaults to send to the Homeowner/Borrower when there was a closing attorney, settlement agent or other person transmitting the payoff, yet NTC was not provided this information, Nationwide Title Clearing can no longer indemnify our client regarding the proper delivery of that release as per the statute. Likewise, Nationwide Title Clearing cannot be held liable for any fines or attorney fees that result due to not being able to send the release to an agent or attorney.

All releases for the State of Massachusetts will be sent through an independent courier service that utilizes full tracking and documentation. This is due to the speed needed to meet the time deadlines and to provide undeniable proof that the release was indeed sent for recordation and the recorded release or a copy of it was sent to the closing attorney, settlement agent or other person transmitting the payoff within the timeframe.

We utilize a special batching and bar-coding procedure to enable us to send multiple documents to the same county together by independent courier, resulting in lower overall shipping/postage costs to you.

Clients have the option to opt-out of any of the above procedures, however, should you choose to opt-out of any of these procedures, Nationwide Title Clearing can no longer indemnify our client for any Massachusetts releases not being forwarded as indicated in the statute to the correct agent or attorney. Likewise, Nationwide Title Clearing cannot be held liable for any fines or attorney fees that result due to choosing to opt-out of any of these new procedures.

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