WBK Industry News - State Regulatory Developments

New Hampshire Procedures and Penalties Relating to Discharge by Affidavit Will Take Effect on January 1st

New Hampshire has established new requirements relating to the discharge of a mortgage by affidavit, and borrowers will be able to recover damages from lenders who do not release their mortgage in accordance with the law.  These changes were enacted by New Hampshire in July of 2015, with an effective date of January 1, 2016.

Under the new statute, if a lender fails to discharge the mortgage within 60 days from receipt of payment in accordance with the payoff statement provided to the borrower, then the borrower, or certain third parties on the borrower’s behalf, may execute an affidavit and have it recorded in the registry of deeds.  The affidavit would state that the borrower has evidence that the lender has received full payment of the mortgage, more than 60 days have elapsed since payment was received by the lender, the borrower gave 15 days’ written notice to the lender of the borrower’s intention to execute and record the affidavit, and despite these facts the lender has failed to deliver a discharge of the mortgage.  The affidavit must also include other information as specified in the statute.

When it is recorded, the affidavit will constitute a discharge of the mortgage and a release of the lien created by the mortgage.  Under the new statute, a lender who fails to discharge a mortgage will be liable to the borrower for damages of $200 per week after the expiration of the 60-day period, up to a maximum of $2,500, or in an amount equal to the loss sustained as a result of the lender’s failure, plus costs and attorney’s fees.

If the borrower or a third party records an affidavit with information that is known to be false is punishable by a fine of up to $5,000.