Rep. Sidney H. Mathias
Filed: 3/31/2004
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1 | AMENDMENT TO HOUSE BILL 6253
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2 | AMENDMENT NO. ______. Amend House Bill 6253 by replacing | ||||||
3 | everything after the enacting clause with the following:
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4 | "Section 5. The Mortgage Act is amended by changing | ||||||
5 | Sections 2 and 4 as follows:
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6 | (765 ILCS 905/2) (from Ch. 95, par. 52)
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7 | Sec. 2. Release; manner.
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8 | (a) Every mortgagee of real property, his assignee of | ||||||
9 | record, or other
legal
representative, having received full | ||||||
10 | satisfaction and payment of all such
sum or sums of money as | ||||||
11 | are really due to him from the mortgagor, and every
trustee, or | ||||||
12 | his successor in trust, in a deed of trust in the nature of a
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13 | mortgage, the notes, bonds or other indebtedness secured | ||||||
14 | thereby having
been fully paid before September 7, 1973, shall, | ||||||
15 | at the request of the
mortgagor, or grantor
in a deed of trust | ||||||
16 | in the nature of a mortgage, his heirs, legal
representatives | ||||||
17 | or assigns, in case such mortgage or trust deed has been
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18 | recorded or registered, make, execute and deliver to the | ||||||
19 | mortgagor or grantor
in a deed
of trust in the nature of a | ||||||
20 | mortgage, his heirs, legal representatives or
assigns, an | ||||||
21 | instrument in writing executed in conformity with the
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22 | provisions of this section releasing such mortgage or deed of | ||||||
23 | trust in the
nature of a mortgage, which release shall be | ||||||
24 | entitled to be recorded or
registered and
the recorder or |
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1 | registrar upon receipt of such a release and the payment of the
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2 | recording fee therefor shall record or register the same.
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3 | Mortgages of real property and deeds of trust in the nature | ||||||
4 | of a
mortgage shall be released of record only in the manner | ||||||
5 | provided herein
or as provided in the Mortgage Certificate of | ||||||
6 | Release Act; however,
nothing contained in this Act shall in | ||||||
7 | any manner affect the
validity of any release of a mortgage or | ||||||
8 | deed of trust made prior to
January 1, 1952 on the margin of | ||||||
9 | the record.
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10 | Except in the case of a mortgage that is required to be | ||||||
11 | released under the
Mortgage Certificate of
Release Act, every | ||||||
12 | mortgagee of real
property, his assignee of record, or other | ||||||
13 | legal representative, having
received full satisfaction and | ||||||
14 | payment of all such sum or sums of money as
are really due to | ||||||
15 | him from the mortgagor, and every trustee, or his
successor in | ||||||
16 | trust, in a deed of trust in the nature of a mortgage, the
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17 | notes, bonds or other indebtedness secured thereby having been | ||||||
18 | fully paid
after September 7, 1973, shall make, execute and | ||||||
19 | deliver to the mortgagor
or grantor in a
deed of trust in the | ||||||
20 | nature of a mortgage, his heirs, legal representatives
or | ||||||
21 | assigns, an instrument in writing releasing such mortgage or | ||||||
22 | deed of
trust in the nature of a mortgage or shall deliver that | ||||||
23 | release to the
recorder or registrar for recording or | ||||||
24 | registering. If the release
is delivered
to the mortgagor or
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25 | grantor, it must have imprinted on its face in bold letters at | ||||||
26 | least 1/4
inch in height the following: "FOR THE PROTECTION OF | ||||||
27 | THE OWNER, THIS
RELEASE SHALL BE FILED WITH THE RECORDER OR THE | ||||||
28 | REGISTRAR OF
TITLES IN WHOSE OFFICE THE
MORTGAGE OR DEED OF | ||||||
29 | TRUST WAS FILED". The recorder, or registrar, upon
receipt of | ||||||
30 | such a
release and the payment of the recording or registration | ||||||
31 | fee, shall record
or register the release. A certificate of | ||||||
32 | release issued and recorded by a
title insurance company or its | ||||||
33 | duly appointed agent pursuant to the Mortgage
Certificate of | ||||||
34 | Release Act shall satisfy the requirements of this Section 2. A |
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1 | mortgagee or trustee in a deed of trust in the nature of a | ||||||
2 | mortgage, its assignee of record, or other legal | ||||||
3 | representative, may include a reasonable fee in its payoff | ||||||
4 | statement for delivering a release as required by this Section | ||||||
5 | or for obtaining verification from a title insurance company | ||||||
6 | that the title insurance company has satisfied the requirements | ||||||
7 | of the Mortgage Certificate of Release Act. | ||||||
8 | (b) A release, in substantially the following form, that is | ||||||
9 | delivered as required by this Section by a mortgagee or trustee | ||||||
10 | in a deed of trust in the nature of a mortgage, its assignee of | ||||||
11 | record, or other legal representative, shall be sufficient if | ||||||
12 | it includes the following: | ||||||
13 | (i) the names of the mortgagors; | ||||||
14 | (ii) the name of the original mortgagee; | ||||||
15 | (iii) the name of the mortgage servicer (if any); | ||||||
16 | (iv) the volume and page or document number of the | ||||||
17 | mortgage recording; | ||||||
18 | (v) an identification of the property described in the | ||||||
19 | mortgage by Permanent Index Number and common address; and | ||||||
20 | (vi) a statement to the effect that the mortgage has | ||||||
21 | been paid in accordance with its terms.
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22 | (Source: P.A. 92-765, eff. 8-6-02; 93-428, eff. 12-31-03.)
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23 | (765 ILCS 905/4) (from Ch. 95, par. 54)
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24 | Sec. 4. If any mortgagee or trustee, in a deed in the | ||||||
25 | nature of a mortgage, of
real property, or his executor or | ||||||
26 | administrator, heirs or assigns, or title insurance company | ||||||
27 | that is required to record a certificate of release pursuant to | ||||||
28 | the Mortgage Certificate of Release Act, knowing
the same to be | ||||||
29 | paid, shall not, within one month after the payment of the
debt | ||||||
30 | secured by such mortgage or trust deed, comply with the | ||||||
31 | requirements
of Section 2 of this Act or the Mortgage | ||||||
32 | Certificate of Release Act , he shall, for every such offense, | ||||||
33 | be liable for
and pay to the party aggrieved the sum of $200 |
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1 | which may be recovered by
the party aggrieved in a civil | ||||||
2 | action, together with reasonable attorney's
fees. In any such | ||||||
3 | action, introduction of a loan payment book or receipt
which | ||||||
4 | indicates that the obligation has been paid shall be sufficient
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5 | evidence to raise a presumption that the obligation has been | ||||||
6 | paid. Upon a
finding for the party aggrieved, the court shall | ||||||
7 | order the mortgagee or
trustee, or his executor or | ||||||
8 | administrator, heirs or assigns, or title insurance company, to | ||||||
9 | make,
execute and deliver the release as provided in Section 2 | ||||||
10 | of this Act or the Mortgage Certificate of Release Act . The
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11 | successor in interest to the mortgagee or trustee in a deed in | ||||||
12 | the nature
of a mortgage shall not be liable for the penalty | ||||||
13 | prescribed in this
Section if he complies with the requirements | ||||||
14 | of Section 2 of this Act
within one month after succeeding to | ||||||
15 | the interest.
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16 | (Source: P.A. 78-587.)
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17 | Section 10. The Mortgage Certificate of Release Act is | ||||||
18 | amended by changing Section 5, 10, 10.1, 25, 35, and 40 as | ||||||
19 | follows:
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20 | (765 ILCS 935/5)
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21 | Sec. 5. Definitions. As used in this Act:
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22 | "Hold-harmless agreement" means a letter whereby a title | ||||||
23 | insurance company,
as defined in the Title Insurance Act, | ||||||
24 | agrees to indemnify another title
insurance company preparing | ||||||
25 | to insure a present transaction that the
indemnifying title | ||||||
26 | insurance company has previously insured over without
taking an | ||||||
27 | exception to its title insurance policy for matters remaining | ||||||
28 | of
record, such as a previously paid but unreleased mortgage. A | ||||||
29 | model form of a
hold-harmless agreement is set forth in Section | ||||||
30 | 70 of this Act.
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31 | "Mortgage" means a mortgage or mortgage lien on an interest | ||||||
32 | in one-to-four
family residential real property
in this State |
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1 | given to secure a loan in the original principal amount of
less | ||||||
2 | than $500,000.
Trust deeds are not included.
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3 | "Mortgagee" means either: (i) the grantee of a mortgage; or | ||||||
4 | (ii) if a
mortgage has been assigned of record, the last person | ||||||
5 | to whom the mortgage has
been assigned of record.
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6 | "Mortgage servicer" means the last person to whom a | ||||||
7 | mortgagor or the
mortgagor's successor in interest has been | ||||||
8 | instructed by a mortgagee to send
payments on a loan secured by | ||||||
9 | a mortgage. A person
transmitting a payoff
statement is the | ||||||
10 | mortgage servicer for the mortgage described in the payoff
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11 | statement.
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12 | "Mortgagor" means the grantor of a mortgage.
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13 | "Payoff statement" means a written statement issued by | ||||||
14 | mortgagee or its mortgage servicer that includes a statement | ||||||
15 | of:
for the amount of the (i) the amount of the unpaid balance
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16 | of a loan secured by a mortgage as of a specified payoff date , | ||||||
17 | including the principal, interest, and any other
charges , fees | ||||||
18 | and costs due under or secured by the mortgage; (ii) any | ||||||
19 | additional charges, fees and costs as may be recited therein | ||||||
20 | including, but not limited to, fees for preparation of a | ||||||
21 | release, charges for delivering a release, late fees, facsimile | ||||||
22 | charges, and other miscellaneous charges;
and (ii)
(iii)
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23 | interest on a per diem
day
basis for the unpaid balance after | ||||||
24 | the specified payoff date; (iv) the place where payment must be | ||||||
25 | made; and (v) any limitation as to the authorized method of | ||||||
26 | payment or other qualifications for satisfaction of the amount | ||||||
27 | due under or secured by the mortgage .
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28 | "Record" means to deliver the certificate of release for | ||||||
29 | recording with the
county recorder.
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30 | "Title insurance" has the same meaning ascribed to it as in | ||||||
31 | Section 3 of the Title Insurance Act.
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32 | "Title insurance agent" has the same meaning ascribed to it | ||||||
33 | as in Section 3
of the Title Insurance Act.
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34 | "Title insurance company" has the same meaning ascribed to |
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1 | it as in
Section 3 of the Title Insurance Act.
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2 | (Source: P.A. 92-765, eff. 8-6-02; 93-428, eff. 12-31-03.)
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3 | (765 ILCS 935/10)
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4 | Sec. 10. Certificate of release; mortgage presently being | ||||||
5 | paid off. Receipt of payment pursuant
to
the lender's
written | ||||||
6 | payoff statement shall constitute authority to record a | ||||||
7 | certificate of
release. | ||||||
8 | (a) A title insurance company or its duly appointed title | ||||||
9 | insurance agent shall execute and deliver for recording a | ||||||
10 | certificate of release pursuant to this Act when: | ||||||
11 | (1) the title insurance company is issuing title | ||||||
12 | insurance in a transaction in which a mortgage to be | ||||||
13 | released is presently being paid off by the title insurance | ||||||
14 | company; | ||||||
15 | (2) the mortgagee or the mortgage servicer has issued a | ||||||
16 | payoff statement; and | ||||||
17 | (3) the mortgagee or the mortgage servicer has received | ||||||
18 | payment in full of the balance needed to satisfy the | ||||||
19 | obligations secured by the mortgage and set forth in the | ||||||
20 | payoff statement. | ||||||
21 | (b)
A certificate of release shall be delivered for | ||||||
22 | recording to the
recorder
of each county in which the mortgage | ||||||
23 | is recorded, together with the other
documents from the new | ||||||
24 | transaction, including a deed or new mortgage, or
both by the | ||||||
25 | title insurance company or its duly appointed title insurance
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26 | agent.
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27 | (c) The title insurance company or its duly appointed title | ||||||
28 | insurance agent shall furnish written notification of the | ||||||
29 | execution and delivery for recording of the certificate of | ||||||
30 | release to the mortgagee or mortgage servicer. The notification | ||||||
31 | shall be included in the transmittal letter or form sent to the | ||||||
32 | mortgagee or mortgage servicer with the payment, or as | ||||||
33 | otherwise directed by the mortgagee or mortgage servicing |
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1 | agent. In the case of a payoff by a wire transfer or other | ||||||
2 | electronic means, a separate notification shall be sent.
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3 | (Source: P.A. 92-765, eff. 8-6-02; 93-428, eff. 12-31-03.)
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4 | (765 ILCS 935/10.1)
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5 | Sec. 10.1. Certificate of release; previously paid | ||||||
6 | mortgages. A title insurance company or its
duly appointed | ||||||
7 | title insurance agent may issue a mortgage certificate of
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8 | release pursuant to this Act for a mortgage that appears in the | ||||||
9 | chain of title
prior to the mortgage presently being paid. The | ||||||
10 | title insurance company must
have proof of payment from its own | ||||||
11 | prior files that it paid the mortgage or
mortgages pursuant to | ||||||
12 | a payoff statement. Where another
title insurance company has | ||||||
13 | paid off an unreleased mortgage pursuant to a
payoff statement, | ||||||
14 | the title insurance company or its
duly appointed title | ||||||
15 | insurance agent in the current transaction may rely upon
the | ||||||
16 | hold-harmless letter of that prior title insurance company
to | ||||||
17 | issue a mortgage certificate of release. This grant of | ||||||
18 | authority
is subject to the condition that the issuer of the | ||||||
19 | mortgage certificate of
release does not have notice that the | ||||||
20 | lender opposes its release. A single
mortgage certificate of | ||||||
21 | release may include more than one mortgage, including
both | ||||||
22 | presently and previously paid mortgages.
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23 | (Source: P.A. 93-428, eff. 12-31-03.)
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24 | (765 ILCS 935/25)
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25 | Sec. 25. Execution.
A certificate of release issued under | ||||||
26 | Sections 10 and 10.1
authorized by Section 15 must be executed | ||||||
27 | and
acknowledged as required by law, as in the case of a deed, | ||||||
28 | and may be executed
by an officer or a duly appointed agent of | ||||||
29 | a title insurance company. The
agent must be a
currently | ||||||
30 | registered title insurance agent of the title insurance | ||||||
31 | company.
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32 | (Source: P.A. 92-765, eff. 8-6-02 .)
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1 | (765 ILCS 935/35)
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2 | Sec. 35. Effect of recording certificate of release. For | ||||||
3 | purposes of releasing the lien of the mortgage, a certificate
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4 | of release containing the information and statements provided | ||||||
5 | for in Section 20
and executed as provided in Section 25 is | ||||||
6 | prima facie evidence of the facts
contained therein, and upon | ||||||
7 | being recorded with the
recorder, shall constitute
a release of
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8 | the lien of
the mortgage described in the certificate of | ||||||
9 | release.
The title insurance company or title insurance agent | ||||||
10 | recording the certificate
of release may use the recording fee | ||||||
11 | it may have collected for the
recording of a release or | ||||||
12 | satisfaction of the mortgage to effect the recording
of
the | ||||||
13 | certificate of release. The title insurance company or its duly | ||||||
14 | appointed title insurance agent may rely upon a payoff | ||||||
15 | statement to determine the amount that must be paid to the | ||||||
16 | mortgagee or mortgage servicer in order to execute and deliver | ||||||
17 | for recording a certificate of release if the title insurance | ||||||
18 | company or its duly appointed title insurance agent acts in | ||||||
19 | good faith and does not know or have reason to know the amount | ||||||
20 | is incorrect. The recording of the certificate of release does | ||||||
21 | not itself extinguish the liability of any person liable for | ||||||
22 | repayment of the obligations secured by the mortgage. The | ||||||
23 | mortgagee or mortgage servicer may recover any sums from the | ||||||
24 | mortgagor or any other person personally liable for the | ||||||
25 | performance of the obligations secured by the mortgage, even if | ||||||
26 | those sums were not included in the payoff statement prior to | ||||||
27 | payment of the obligation in full.
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28 | (Source: P.A. 92-765, eff. 8-6-02; 93-428, eff. 12-31-03.)
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29 | (765 ILCS 935/40)
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30 | Sec. 40. Wrongful or erroneous certificate of release.
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31 | Delivery for recording of a wrongful or erroneous certificate | ||||||
32 | of release by a
title insurance company or its
title insurance
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1 | agent shall not relieve the mortgagor or the
mortgagor's | ||||||
2 | successors or assignees from any personal liability on the loan | ||||||
3 | or
other obligations secured by the mortgage. In addition to | ||||||
4 | any other remedy
provided by law, a title insurance company
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5 | executing and delivering for
or
recording a certificate of | ||||||
6 | release
under this Act , directly or by its duly appointed title | ||||||
7 | insurance agent, is liable to the
mortgagee for actual damages | ||||||
8 | sustained due to the recording of the certificate
of release.
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9 | The prevailing party
in any action or proceeding seeking actual | ||||||
10 | damages due to
the recording of a certificate of release shall | ||||||
11 | be entitled
to the recovery of reasonable attorneys fees and | ||||||
12 | costs
incurred in that action or proceeding.
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13 | (Source: P.A. 92-765, eff. 8-6-02; 93-428, eff. 12-31-03.)
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14 | (765 ILCS 935/15 rep.)
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15 | Section 15. The Mortgage Certificate of Release Act is | ||||||
16 | amended by repealing Section 15.
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17 | Section 99. Effective date. This Act takes effect upon | ||||||
18 | becoming law.".
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