Changes Coming to Filing Requirements for Security Deeds in Georgia | Insights | Holland & Knight

A brand new Georgia regulation modifications the data required on safety deeds and can assist Superior Court docket clerks clear backlogs within the state’s bigger counties whereas making the submitting course of extra environment friendly. Beginning in July 2023, attorneys who draft safety deeds shall be required to listing important info on the primary web page of the doc.

Safety deeds often are drafted by the lawyer for the lender and reviewed by the borrower’s lawyer and the title firm. The title firm is the gatekeeper and often recordsdata the safety deed as a result of it’s the insurer of the precedence of the lien. All events have an curiosity in well timed recording of a safety deed and needs to be cognizant of the brand new necessities.

The brand new regulation additionally requires all Superior Court docket clerks to supply digital submitting for the recording of safety deeds, together with a public laptop terminal that permits courthouse entry to the Georgia Superior Court docket Clerk’s Cooperative Authority’s digital submitting portal.

The brand new regulation, Home Invoice (HB) 974, addresses inefficiencies in the way in which that knowledge is scattered all through safety deeds and, in some instances, not listed anyplace. Safety deeds for business transactions generally run 60 to 80 pages, and important info such because the mortgage quantity and maturity date could be anyplace within the paperwork. This implies the clerk’s workplace should seek for the data earlier than coming into it into required fields of their recording methods and sometimes results in rejections of the deeds or delays if the data can’t be discovered. With the brand new format, all the data the clerk’s workplace must enter into the county information is in a single handy place.

Information Factors Required on First Web page

Below HB 974, as much as 9 knowledge factors have to be listed on the primary web page of a safety deed or deed modification. These knowledge factors are:

1. The date of the doc
2. The names of the signatories to the doc
3. The grantee’s mailing handle
4. Map and parcel identification info, if obtainable
5. The unique mortgage quantity or the quantity of any excellent principal and extra advance in line with a mortgage modification
6. The preliminary maturity date or dates for the debt
7. The quantity of the intangible recording tax payable
8. The quantity, if any, of the intangible recording tax imposed for an extra advance in line with a safety deed modification settlement or different further advance secured by a safety deed
9. If no intangible tax is imposed, a quotation to the authority offering for the exemption of the tax

Takeaways and Concerns

A very powerful change is the requirement to listing the quantity of the intangible tax. At present, clerks’ workplaces require solely that the quantity of the mortgage and the date of maturity be listed, leaving the clerk to calculate the tax. The commonest exemption to the tax is a mortgage maturity date of fewer than three years. If the exemption and maturity date will not be clearly said and readily accessible in paperwork, it might result in rejection of the submitting or a minimum of a delay whereas the clerk’s workplace contacts the events to the doc. Most safety deed rejections stem from an absence of readability within the tax info.

Failure to observe the brand new format is not going to have an effect on foreclosures rights or some other authorized rights beneath a mortgage settlement, however not offering the required info on the primary web page of a safety deed will result in an computerized rejection of the submitting. The Georgia Common Meeting particularly offered that not offering correct tax parcel info is not going to void a transaction and nothing within the regulation modifications the enforceability of a deed, mortgage, judgment or lien.

Whereas these submitting necessities will not be mandated till July 1, 2023, it’s endorsed that events to safety deeds start complying instantly with a view to have a clean course of in place subsequent yr. Following the brand new format now additionally will assist clerks’ workplaces develop into extra environment friendly, which advantages all events.

Pattern Cowl Sheet

The regulation doesn’t require a particular format for paperwork, aside from to listing all of the required info on the primary web page. Holland & Knight has included a pattern kind that can be utilized for the primary web page of safety deeds.