Requests the Louisiana State Law Institute to study and make recommendations regarding whether an assignment or transfer of a mortgage loan on residential real property should be required to be recorded in the appropriate mortgage or conveyance records in order to be effective as to third parties.
The resolution specifically aims to address the confusion faced by mortgage borrowers when their loans are sold or assigned to new mortgage holders. By requiring recording of such assignments, it seeks to enhance transparency and provide homeowners with clear contact information for their mortgagee. This change could potentially facilitate better communication for mortgage payments and help borrowers avoid foreclosure due to payment misdirections. The implications on state law would revolve around adjusting existing statutes to improve consumer rights and protections in mortgage transactions.
SCR102 is a Senate Concurrent Resolution from Louisiana that urges the State Law Institute to study the requirements surrounding the recording of mortgage loan assignments or transfers on residential real property. Currently, the state's Civil Code stipulates that certain written instruments must be recorded in appropriate mortgage or conveyance records to be effective as to third parties. However, this list does not include assignments of mortgage loans, which can lead to ambiguity regarding the identity of mortgagees for homeowners during transactions in the secondary market.
The sentiment surrounding SCR102 appears to be constructive and focused on consumer advocacy. Lawmakers advocating for the study view it as a necessary step to improve the mortgage system for homeowners, thereby fostering trust and clarity in mortgage operations. There is a general consensus that clear identification of mortgage holders is vital for effective transactions and upholding homeowner rights, suggesting bipartisan support for the resolution's intent.
While SCR102 aims for improvement, it is likely to encounter debate regarding the feasibility of implementing mandatory recording of mortgage assignments. Concerns may arise about the administrative burden this could place on mortgage lenders and whether it could delay transactions. Furthermore, potential costs for additional documentation and public record keeping could be raised in discussions concerning the resolution. The outcomes of the proposed study by the Louisiana State Law Institute will be crucial in understanding the viability of formalizing new recording requirements.