N.Y. RPA Law § 1921 — New York Code / Act RPA / Article 19 / Section 1921
Discharge of mortgage
Status: in_force

§ 1921. Discharge of mortgage.  1. (a) After payment of authorized\nprincipal, interest and any other amounts due thereunder or otherwise\nowed by law has actually been made, and in the case of a credit line\nmortgage as defined in section two hundred eighty-one of the real\nproperty law on written request, a mortgagee of real property situate in\nthis state, unless otherwise requested in writing by the mortgagor or\nthe assignee of such mortgage, must execute and acknowledge before a\nproper officer, in like manner as to entitle a conveyance to be\nrecorded, a satisfaction of mortgage, and thereupon within thirty days\narrange to have the satisfaction of mortgage: (i) presented for\nrecording to the recording officer of the county where the mortgage is\nrecorded, or (ii) if so requested by the mortgagor or the mortgagor's\ndesignee, to the mortgagor or the mortgagor's designee. Failure by a\nmortgagee to present a certificate of discharge for recording shall\nresult in the mortgagee being liable to the mortgagor in the amount of\nfive hundred dollars if such mortgagee fails to present such certificate\nwithin thirty days, shall result in the mortgagee being liable to the\nmortgagor in the amount of one thousand dollars if such mortgagee fails\nto present a certificate of discharge for recording within sixty days or\nshall result in the mortgagee being liable to the mortgagor in the\namount of one thousand five hundred dollars if such mortgagee fails to\npresent a certificate of discharge for recording within ninety days. For\nthe purposes of such liability under this subdivision, the term\n"mortgagee" shall not include a person, partnership, association,\ncorporation or other entity which makes less than five mortgage loans in\nany calendar year. The mortgagee shall within forty-five days deliver\nthe note and the mortgage and where a title is registered under article\ntwelve of the real property law, the registration copy of the mortgage\nand any registration certificates in the mortgagee's possession to the\nmortgagor or the mortgagor's designee making such payment and request if\nrequired as aforesaid. Delivery of a satisfaction of mortgage in\naccordance with the terms of section two hundred seventy-five of the\nreal property law shall be deemed to satisfy the requirements of this\nsection regarding the satisfaction of mortgage.\n  (b) No mortgagee shall return, destroy, or otherwise refuse to accept\na payment made pursuant to the terms of a payoff letter, including but\nnot limited to terms regarding the location and the manner of payment\nspecified by the mortgagee, even if such payment does not cover the full\namount of principal, interest, and any other amounts due and owing under\nthe mortgage, provided, however, if there is a defect with the payment\nthat prevents the mortgagee from identifying with reasonable diligence\nthe mortgage for which such payment is made, the mortgagee may refuse to\naccept such payment and return the payment to the remitter. The\nmortgagee shall apply such payment to the unpaid principal, interest or\nany other amounts due under the mortgage, provided that a payment made\npursuant to a payoff statement shall not result in the execution of a\nsatisfaction of mortgage pursuant to paragraph (a) of this subdivision\nor in the issuance of a certificate of discharge of mortgage pursuant to\nsubdivision one of section two hundred seventy-five of the real property\nlaw unless the payment covers the full amount of principal, interest,\nand any other amounts due and owing under the mortgage.\n  2. Upon the failure or refusal of any such mortgagee to comply with\nthe foregoing provisions of this section any person having an interest\nin the mortgage or the debt or obligation secured thereby or in the\nmortgaged premises may apply to the supreme court or a justice thereof,\nor to the county court or a judge thereof, in or of any county in which\nthe mortgaged premises or any part thereof are situated in whole or in\npart, upon a petition, for an order to show cause why an order should\nnot be made by such court canceling and discharging the mortgage of\nrecord, and directing the register or clerk of any county in whose\noffice the same may have been recorded to mark the same upon his records\nas canceled and discharged, and further ordering and directing that the\ndebt or other obligation secured by the mortgage be canceled, upon\ncondition that in the event such mortgage is not paid, the sums tendered\npursuant to the foregoing provisions of this section be paid to the\nofficer specified by law to hold court funds and moneys deposited in\ncourt in the county wherein the mortgaged premises are situated in whole\nor in part. Said petition must be verified in like manner as a verified\npleading in an action in the supreme court and it must set forth the\ngrounds of the application.\n  3. In any case where an actual tender, as provided in subdivision one\nof this section, cannot with due diligence be made within this state,\nany person having an interest in the mortgage or the debt or obligation\nsecured thereby, or in the mortgaged premises, may apply to the supreme\ncourt or a justice thereof, or to the county court or a judge thereof,\nin or of any county in which the mortgaged premises, or any part thereof\nare situated in whole or in part, upon petition setting forth the\ngrounds of the application and verified as aforesaid, for an order to\nshow cause why an order should not be made by said court canceling and\ndischarging the mortgage of record, and directing the register or clerk\nof any county in whose office the same may have been recorded to mark\nthe same upon his records as canceled and discharged and further\nordering and directing that the debt or other obligation secured by the\nmortgage be canceled, upon condition that the principal sum of the\nmortgage or any unpaid balance thereof, with interest up to the date\nwhen said order shall be entered and the aforesaid fees allowed by law,\nbe paid to the officer specified by law to hold court funds and moneys\ndeposited in court in the county wherein the mortgaged premises are\nsituated in whole or in part.\n  4. In the case of a mortgage secured by property improved by a\none-to-six family, owner occupied, residential structure or residential\ncondominium unit, if the mortgagee fails within ninety days to deliver\nthe satisfaction of mortgage and/or fails within ninety days to deliver\nthe note and the mortgage and any other documents as required by\nsubdivision one of this section and if the mortgage is not otherwise\nsatisfied the mortgagee shall be liable to such person in the amount of\nfive hundred dollars or the economic loss to such person, whichever is\ngreater. If the mortgagee has delivered such satisfaction of mortgage in\na timely manner and has certified that the note and/or mortgage are not\nin its possession as of such date, the mortgagee shall not be liable\nunder this section if the mortgagee agrees to defend and hold harmless\nthe mortgagor by reason of the inability or failure of the mortgagee to\nfurnish the note or mortgage within the time period prescribed in this\nsubdivision; provided that in connection with mortgage loans purchased\nprior to July twenty-seven, nineteen hundred ninety-one by the state of\nNew York mortgage agency pursuant to section two thousand four hundred\nfive or two thousand four hundred-five-b of the public authorities law,\nthe state of New York mortgage agency, its successors or assigns shall\nnot be liable under this section if it does not defend and hold harmless\nthe mortgagor by reason of the inability or failure of the state of New\nYork mortgage agency, its successors or assigns to furnish the note or\nmortgage within the time period prescribed in this subdivision. Damages\nimposed by this subdivision shall be in addition to the other costs and\nfees allowed in this section.\n  5. (a) In the case of a mortgage secured by property improved by a\none-to-six family, owner occupied, residential structure or residential\ncondominium unit, if within ninety days of receipt of payment, and\nrequest if required, the mortgagee fails to deliver to the mortgagor or\nthe mortgagor's designee the satisfaction of mortgage, the note and the\nmortgage and any other documents as required by subdivision one of this\nsection, any attorney-at-law may execute, acknowledge and upon payment\nof an additional filing fee of fifty dollars cause to be filed with the\nrecording officer of the county where the mortgage is recorded, an\naffidavit which complies with this section. Unless the mortgagee shall\nfile a verified objection to such affidavit within thirty-five days of\nbeing filed, as of the date thirty-five days subsequent to its filing,\nsuch affidavit shall be recorded and satisfy the lien of such mortgage\non the mortgaged premises.\n  (b) The affidavit shall state that:\n  (i) The affiant is an attorney-at-law and that the affidavit is made\non behalf of and at the request of the mortgagor or any person who has\nacquired title to the mortgaged premises;\n  (ii) The mortgagor made a proper request of the mortgagee for the\nexecution of the satisfaction of mortgage pursuant to subdivision one of\nthis section;\n  (iii) The mortgagor has received a payoff statement for the loan\nsecured by the mortgage, and shall annex as evidence a copy of the\npayoff statement;\n  (iv) The affiant has ascertained that the mortgagee received payment\nof the loan in accordance with the payoff statement, and shall annex as\nevidence, copies of the check negotiated by the mortgagee or documentary\nevidence of such payment;\n  (v) The affiant, at least thirty days after the mortgagee received\npayment, has given the mortgagee written notice together with a copy of\nthe proposed affidavit, delivered by certified or registered mail,\nreturn receipt requested, to the attention of the person or department\nset forth in the payoff statement, of the affiant's intention to execute\nand record an affidavit in accordance with this section; and\n  (vi) The mortgagee has not responded in writing to such notification\nor all requests by the mortgagee for payment have been complied with at\nleast fifteen days prior to the date of the affidavit.\n  (c) Such affidavit shall identify the mortgagor and the mortgagee,\nstate the date of the mortgage, the liber and page of the land records\nwhere the mortgage is recorded and give similar information with respect\nto any recorded assignment of the mortgage.\n  (d) The affiant shall attach to the affidavit photostatic copies of\nthe documentary evidence that payment has been received by the\nmortgagee, including mortgagee's endorsement of any check, and a\nphotostatic copy of the payoff statement and certify each to be a copy\nof the original document.\n  (e) Within five days of the filing of such affidavit the register or\nclerk of every county in whose office said mortgage has been recorded\nshall give the mortgagee written notice, delivered by certified or\nregistered mail, return receipt requested, to the attention of the\nperson or department set forth in the payoff statement, as annexed to\nthe affidavit filed hereunder, of the filing of such affidavit, which\nnotice shall include the following notice in capital letters:\n  "THIS NOTICE IS MADE UNDER SECTION 1921 OF THE REAL PROPERTY ACTIONS\nAND PROCEEDINGS LAW. FAILURE TO FILE WITH THIS OFFICE WITHIN THIRTY DAYS\nOF THIS NOTICE A VERIFIED OBJECTION TO THE DISCHARGE OF THE MORTGAGE\nDESCRIBED IN THIS NOTICE WILL RESULT IN SUCH MORTGAGE BEING CANCELED AND\nDISCHARGED OF RECORD."\nUnless the register or clerk of such county shall receive from the\nmortgagee, within thirty-five days of the date of filing of such\naffidavit, a verified objection by the mortgagee to the discharge of\nsaid mortgage, the register or clerk shall record the affidavit and\nsupporting documents and mark the mortgage described in the affidavit\ncanceled and discharged of record and such recorded affidavit shall have\nthe same force and effect as a duly executed satisfaction of mortgage\nrecorded in accordance with section three hundred twenty-one of the real\nproperty law. If the register or clerk of such county shall receive from\nthe mortgagee, within thirty-five days of the date of filing of such\naffidavit, a verified objection by the mortgagee to the discharge of\nsaid mortgage, the register or clerk shall return the original affidavit\nand the verified objection to the attorney filing such affidavit without\nmarking the mortgage described in the affidavit canceled or discharged\nof record. The clerk or register of such county shall additionally\ntransmit a copy of the affidavit and the verified objection to its\napplicable appellate division of the supreme court, committee on\nprofessional standards, for such further proceedings as determined\nappropriate by such committee.\n  (f) The county clerk or register shall index the affidavit in the same\nmanner as a satisfaction of mortgage and shall record such instrument\nupon payment of the same fees as for a satisfaction of mortgage.\n  (g) (i) Any attorney who prepares an affidavit and negligently causes\nthe affidavit to contain false information shall be liable to the\nmortgagee for any monetary damages and subject to other applicable\nsanctions under law.\n  (ii) Any person who supplies false information for the affidavit shall\nbe liable to the mortgagee for any monetary damages and subject to other\napplicable sanctions under law.\n  (h) A banking or other organization having the original or copies\nthereof, shall furnish, within sixty days of receiving a written\nrequest, a copy of the front and reverse sides of a check issued to\nsatisfy the mortgage obligation by such banking or other organization,\nneeded for completion of an affidavit in accordance with this subdivi-\nsion.\n  6. Eight days' notice of the application for either of the orders\nprovided for in subdivisions two and three of this section shall be\ngiven to the then mortgagee of record and also, if the petition show\nthat there is a mortgage not of record, to such mortgagee. Such notice\nshall be given in such manner as the court or the judge or justice\nthereof to whom the petition is presented may direct, and said court or\njudge or justice may require such longer notice to be given as may seem\nproper. If sufficient cause be shown the court or judge or justice\nthereof may issue such order to show cause returnable in less than eight\ndays.\n  7. Upon the return day of such order to show cause, the court, upon\nproof of due service thereof and on proof of the identity of the\nmortgagee and of the person presenting the petition, shall inquire in\nsuch manner as it may deem advisable, into the truth of the facts set\nforth in the petition, and in case it shall appear that said principal\nsum or any unpaid balance thereof and interest and the said fees allowed\nby law have been duly paid or tendered but not accepted and said\nsatisfaction of mortgage has been duly presented for execution, or that\nsuch tender and presentation could not have been made within this state\nwith due diligence, then, in the event such mortgage is not paid, the\ncourt shall make an order directing the sums so tendered, or in a case\nwhere such tender could not have been made as aforesaid, directing the\nprincipal sum or any unpaid balance thereof, with interest thereon to\nthe date of entry of said order together with all other amounts due\nthereunder pursuant to subdivision three of this section and the\naforesaid fees allowed by law, to be paid to the officer specified by\nlaw to hold court funds and moneys deposited in court in the county\nwherein the application herein is made, and directing and ordering that\nupon such payment the debt or other obligation secured by the mortgage\nbe canceled and further directing the register or clerk of any and every\ncounty in whose office said mortgage shall have been recorded to mark\nsaid mortgage canceled and discharged of record upon the production and\ndelivery to such register or clerk of a certified copy of the order and\nthe receipt of such officer, showing that the amount required by said\norder has been deposited with him, which certified copy of said order\nand which receipt shall be recorded, filed and indexed by any such\nregister or clerk in the same manner as a certificate of discharge of a\nmortgage. Said receipt need not be acknowledged to entitle it to be\nrecorded. The court in its discretion, when granting any such order\nafter application therefor pursuant to subdivision two of this section,\nmay award costs and reasonable attorney's fees to the person making the\napplication, in the absence of the showing of a valid reason for the\nfailure or refusal to execute the satisfaction of mortgage and deliver\nthe same, the note and mortgage and any other documents required under\nsubdivision one of this section. The money deposited shall be payable to\nthe mortgagee, his personal representative or assigns, upon an order of\nthe supreme court or county court, directing the payment thereof to him\nupon such evidence as to his right to receive the same as shall be\nsatisfactory to the court.\n  8. Wherever any register or clerk shall record any order and receipt\nas hereinbefore specified, he shall mark the record of said mortgage as\nfollows:\n  "Canceled and discharged by order of the ..........................\nCourt, County of ......................., dated .................. and\nfiled .......................," and thereupon the lien of such mortgage\nshall be deemed to be discharged and the debt secured thereby shall be\ndeemed to be canceled. Said register or clerk shall be permitted to\ncharge for recording and filing said order and receipt, the same fees to\nwhich he is now entitled for recording and filing a certificate of\nsatisfaction of a mortgage.\n  9. When used in this section:\n  (a) "Mortgagee" means (i) the current holder of the mortgage of record\nor the current holder of the mortgage, or (ii) any person to whom\npayments are required to be made or (iii) their personal\nrepresentatives, agents, successors, or assigns.\n  (b) "Attorney-at-law" means any person admitted to practice law in\nthis state and in good standing.\n  (c) "Payoff statement" means a statement setting forth the unpaid\nbalance of the mortgage, including principal, interest and other charges\npursuant to the loan documents, together with a per diem rate for\ninterest accruing after the date to which the unpaid balance has been\ncalculated. The payoff statement furnished by a banking organization or\ncorporate mortgagee shall include a name of an individual employed by\nsuch banking organization or corporate mortgagee or department of such\nbanking organization or corporate mortgagee to whom inquiry concerning\nthe payoff statements are to be addressed in addition to the address of\nthe banking organization or corporation for use in connection with the\naffidavit under subdivision five of this section.\n  (d) "Banking organization" shall have the same meaning as provided in\nsubdivision eleven of section two of the banking law and shall include\nany institution chartered or licensed by the United States or any state.\n  (e) "Note" shall include any written evidence of indebtedness.\n