Title 7. Mortgages, Deeds of Trust, and Vendor's Liens — Subtitle 1. Mortgages and Deeds of Trust

No mortgage or deed of trust may be a lien or charge on any property for any principal sum of money in excess of the aggregate principal sum appearing on the face of the mortgage or deed of trust and expressed to be secured by it, without regard to whether or when advanced or readvanced.

Paragraph (1) of this subsection does not apply to a mortgage or deed of trust to:

A mortgage or deed of trust may authorize the sale of the property or declare the borrower’s assent to the passing of a decree for the sale of the property, on default in a condition on which the mortgage or deed of trust provides that a sale may be made.

A power of sale or assent to decree authorized in a mortgage or deed of trust may be exercised only by an individual.

The individual selling the property under a power of sale need not be named in the mortgage or deed of trust.

An error or omission in a mortgage or deed of trust concerning the designation of the trustee or the individual authorized to exercise a power of sale does not invalidate the instrument or the ability of the mortgagee or beneficiary of the deed of trust to appoint an individual to exercise the power of sale.

If a mortgage or deed of trust allows for the appointment or substitution of a trustee or an individual authorized to exercise a power of sale, the holder of the mortgage or deed of trust may make the appointments or substitutions from time to time.

In this section the following words have the meanings indicated.

“Final loss mitigation affidavit” means an affidavit that:

“Foreclosure mediation” means a conference at which the parties in a foreclosure action, their attorneys, additional representatives of the parties, or a combination of those persons appear before an impartial individual to discuss the positions of the parties in an attempt to reach agreement on a loss mitigation program for the mortgagor or grantor.

“Housing counseling services” means assistance provided to mortgagors or grantors by nonprofit and governmental entities that are identified on a list maintained by the Department of Housing and Community Development.

“Loss mitigation analysis” means an evaluation of the facts and circumstances of a loan secured by owner–occupied residential property to determine:

“Loss mitigation program” means an option in connection with a loan secured by owner–occupied residential property that:

“Owner–occupied residential property” means residential property in which at least one unit is occupied by an individual who:

“Postfile mediation” means foreclosure mediation that occurs in accordance with subsection (j) of this section after the date on which the order to docket or complaint to foreclose is filed.

“Prefile mediation” means foreclosure mediation that occurs in accordance with subsection (d) of this section before the date on which the order to docket or complaint to foreclose is filed.

“Preliminary loss mitigation affidavit” means an affidavit that:

“Residential property” means real property improved by four or fewer single family dwelling units that are designed principally and are intended for human habitation.

Except as provided in paragraph (2) of this subsection, an action to foreclose a mortgage or deed of trust on residential property may not be filed until the later of:

This subsection applies only to an action for the foreclosure of a mortgage or deed of trust on an owner–occupied residential property.

Notwithstanding any other law, the court shall stay the proceedings if the defendant presents evidence satisfactory to the court that the defendant is:

Except as provided in subsection (b)(2)(iii) of this section, at least 45 days before the filing of an action to foreclose a mortgage or deed of trust on residential property, the secured party shall send a written notice of intent to foreclose to the mortgagor or grantor and the record owner.

The notice of intent to foreclose shall be sent:

A copy of the notice of intent to foreclose shall be sent to the Commissioner of Financial Regulation.

The notice of intent to foreclose shall:

For an owner–occupied residential property, the notice of intent to foreclose shall be accompanied by:

For a property that is not an owner–occupied residential property, the notice of intent to foreclose shall be accompanied by:

For owner–occupied residential property, a secured party may offer to participate in prefile mediation with a mortgagor or grantor to whom the secured party has delivered a notice of intent to foreclose.

If offered by a secured party, a mortgagor or grantor may elect to participate in prefile mediation.

If a mortgagor or grantor elects to participate in prefile mediation, the mortgagor or grantor shall notify the secured party by submitting the application described in subsection (c)(5)(vi) of this section not more than 25 days after the date on which the notice of intent to foreclose is mailed by the secured party.

If a mortgagor or grantor submits an application to participate in prefile mediation to the secured party in accordance with paragraph (3) of this subsection, the secured party shall notify the Office of Administrative Hearings not more than 5 business days after the date on which the secured party receives the application.

The Office of Administrative Hearings shall:

By regulation, the Commissioner of Financial Regulation shall:

The fee for prefile mediation collected under this subsection shall be distributed to the Housing Counseling and Foreclosure Mediation Fund established under § 4–507 of the Housing and Community Development Article.

By regulation, the Commissioner of Financial Regulation shall establish a mediation checklist that describes the matters that shall be reviewed and considered in a prefile mediation.

If the prefile mediation results in an agreement, the parties shall execute a prefile mediation agreement.

In addition to describing the terms of the agreement among the parties, the prefile mediation agreement shall, in 14 point, bold font:

The Office of Administrative Hearings shall draft the prefile mediation agreement and provide a copy of the executed agreement to the parties and their attorneys, if any.

The Office of Administrative Hearings shall provide a report of results of mediation to the parties and their attorneys, if any.

If a mortgagor or grantor notifies the person designated under paragraph (13) of this subsection of a change of financial circumstances, the designee shall:

To the extent that a notice of intent to foreclose complies with this section and otherwise is valid under the law, a notice of intent to foreclose issued with respect to a property that has been the subject of prefile mediation continues to be valid for 1 year after the date on which the initial prefile mediation agreement is executed by the parties.

Nothing in this subsection shall prohibit a secured party and mortgagor or grantor from engaging in loss mitigation by other means.

Include:

Be accompanied by:

Identifies the owner of the debt instrument and states from whom and the date on which the owner acquired ownership;

States why a copy of the debt instrument cannot be produced; and

Describes the good faith efforts made to produce a copy of the debt instrument.

Establish communication with the mortgagor or grantor; or

Obtain all documentation and information necessary to conduct the loss mitigation analysis.

A copy of the order to docket or complaint to foreclose on residential property and all other papers filed with it in the form and sequence as prescribed by regulations adopted by the Commissioner of Financial Regulation, accompanied by the documents required under paragraphs (2), (3), and (4) of this subsection, shall be served on the mortgagor or grantor by:

The service of documents under paragraph (1) of this subsection shall be accompanied by a separate, clearly marked notice, in the form prescribed by regulation adopted by the Commissioner of Financial Regulation, that states:

If the order to docket or complaint to foreclose is accompanied by a preliminary loss mitigation affidavit, the service of documents under paragraph (1) of this subsection shall be accompanied by a loss mitigation application form and any other supporting documents as prescribed by regulation adopted by the Commissioner of Financial Regulation.

If at least two good faith efforts to serve the mortgagor or grantor under paragraph (1) of this subsection on different days have not succeeded, the plaintiff may effect service by:

The individual making service of documents under this subsection shall file proof of service with the court in accordance with the Maryland Rules.

If the order to docket or complaint to foreclose is accompanied by a preliminary loss mitigation affidavit, the secured party, at least 30 days before the date of a foreclosure sale, shall:

A final loss mitigation affidavit shall be filed under this subsection no earlier than 28 days after the order to docket or complaint to foreclose is served on the mortgagor or grantor.

Within 5 days after receipt of a request for postfile mediation, the court shall transmit the request to the Office of Administrative Hearings for scheduling.

The Office of Administrative Hearings shall send notice of the scheduled foreclosure mediation to the foreclosure attorney, the secured party, and the mortgagor or grantor.

The notice from the Office of Administrative Hearings shall:

At a foreclosure mediation:

At the foreclosure mediation, the parties and the mediator shall address loss mitigation programs that may be applicable to the loan secured by the mortgage or deed of trust that is the subject of the foreclosure action.

The Office of Administrative Hearings shall file a report with the court that states the outcome of the request for foreclosure mediation within the earlier of:

Except for a request for postponement or a failure to appear, the rules of procedure for contested cases of the Office of Administrative Hearings do not govern a foreclosure mediation conducted by the Office.

If the parties do not reach an agreement at the postfile mediation, or the 60–day mediation period expires without an extension granted by the Office of Administrative Hearings, the foreclosure attorney may schedule the foreclosure sale.

Nothing in this subtitle precludes the mortgagor or grantor from pursuing any other remedy or legal defense available to the mortgagor or grantor.

If the residential property is not owner–occupied residential property, at least 45 days after service of process is made under subsection (h) of this section;

If the residential property is owner–occupied residential property and foreclosure mediation is not held, the later of:

If the residential property is owner–occupied residential property and postfile mediation is requested, at least 15 days after:

If a certified community development financial institution makes an offer to a secured party to purchase owner–occupied residential property for the purpose of transferring the property to the immediately preceding mortgagor or grantor, no person may require, as a condition of a sale or transfer of the property to the certified community development financial institution, any affidavit, statement, agreement, or addendum that limits ownership or occupancy of the property by the immediately preceding mortgagor or grantor.

Any affidavit, statement, agreement, or addendum that limits ownership or occupancy of owner–occupied residential property by the immediately preceding mortgagor or grantor:

The mortgagor or grantor of residential property has the right to cure the default by paying all past due payments, penalties, and fees and reinstate the loan at any time up to 1 business day before the foreclosure sale occurs.

The secured party or an authorized agent of the secured party shall, on request, provide to the mortgagor or grantor or the mortgagor’s or grantor’s attorney within a reasonable time the amount necessary to cure the default and reinstate the loan and instructions for delivering the payment.

In this section the following words have the meanings indicated.

“Foreclosed Property Registry” means the Foreclosed Property Registry established by the Commissioner of Financial Regulation under § 7–105.14 of this subtitle.

“Local jurisdiction” means:

“Notice of foreclosure” means the notice described in subsection (b) of this section.

“Person authorized to make the sale” means the person designated under the Maryland Rules to sell residential property subject to foreclosure.

“Residential property” means real property improved by four or fewer dwelling units that are designed principally and are intended for human habitation.

Within 7 days of the filing of an order to docket or a complaint to foreclose a mortgage or deed of trust on a residential property by a person authorized to make the sale of the residential property, the person authorized to make the sale shall provide the Commissioner of Financial Regulation with a notice of foreclosure as required under this subsection.

The notice of foreclosure shall:

A notice of foreclosure:

The Commissioner of Financial Regulation may authorize access to a notice of foreclosure only to local jurisdictions, the agencies of local jurisdictions, and representatives of State agencies.

Notwithstanding paragraphs (1) and (2) of this subsection, the Commissioner of Financial Regulation or a local jurisdiction may provide information for a specific property described in a notice of foreclosure to:

The name, address, and telephone number of the person authorized to make the sale; and

The time, place, and terms of sale.

30 days before the day on which a foreclosure sale of the property is actually held; and

The date on which an action to foreclose the mortgage or deed of trust is filed.

The record owner of the property to be sold; and

A condominium or homeowners association that, at least 30 days before the date of the proposed sale, has recorded a statement of lien against the property under the Maryland Contract Lien Act.

The written notice shall be sent:

The notice shall state the time, place, and terms of the sale and shall be sent not earlier than 30 days and not later than 10 days before the date of sale.

The person giving the notice shall file in the proceedings:

The person authorized to make a sale in an action to foreclose a mortgage or deed of trust is not required to give notice to a record owner whose address is not reasonably ascertainable.

The land records office of each county shall maintain a current listing of recorded requests for notice of sale by holders of subordinate mortgages, deeds of trust, or other subordinate interests.

The holder of a subordinate mortgage, deed of trust, or other subordinate interest may file a request for notice under this subsection.

Each request for notice of sale shall:

The return receipt from the notice; or

An affidavit that:

The existence of the mortgage, deed of trust, or other subordinate interest is not reasonably ascertainable;

The identity or address of the holder of the mortgage, deed of trust, or other subordinate interest is not reasonably ascertainable;

With respect to a recorded or filed subordinate mortgage, deed of trust, or other recorded or filed subordinate interest, the recordation or filing occurred after the later of:

With respect to an unrecorded or unfiled subordinate mortgage, deed of trust, or other unrecorded or unfiled subordinate interest, the subordinate interest was created after the later of:

With respect to a condominium council of unit owners or homeowners association, the condominium council of unit owners or homeowners association has not filed a request for notice under subsection (c) of this section.

60 days in Calvert, Cecil, Frederick, Garrett, Kent, Queen Anne’s, Talbot, Caroline, Charles, and St. Mary’s counties; and

180 days in Worcester County.

For purposes of this subsection, a lease or tenancy shall be considered “bona fide” only if:

In the case of a foreclosure on any residential property, an immediate successor in interest who has acquired legal title to the property under the foreclosure shall assume the interest subject to:

Subject to the receipt by the tenant of the notice to vacate under paragraph (2)(i) of this subsection, a successor in interest may terminate a lease effective on the date of the sale of the residential property to a purchaser who will occupy the property as the purchaser’s primary residence.

The notice required under paragraph (2)(i) of this subsection shall:

This section does not affect the requirements for termination of any federal– or State–subsidized tenancy or of any State or local law that provides longer time periods or additional protection for tenants.

If the required advertisement of sale so discloses, a foreclosure sale shall be made subject to one or more of the tenancies entered into subsequent to the recording of the mortgage or deed of trust or otherwise subordinated thereto.

Any lease so continuing is unaffected by the sale, except the purchaser shall become the landlord, as of the date of the sale, on ratification of the sale.

Notwithstanding the provisions of subsection (a) of this section, after the sale, the debtor or those claiming under him and the purchaser or those claiming under him may agree on a reasonable rental of the part of the property occupied by the crops.

This rental is a lien on the crops and continues until paid in favor of the purchaser or those claiming under him, and neither the crops nor any part of them may be removed until after payment.

If the parties are unable to agree on the rental, any party in interest may apply to the court having jurisdiction over the sale or the confirmation of it for the appointment of disinterested appraisers to determine the rental, whose award shall be final.

In addition to any other remedy, the purchaser or those claiming under him, on ascertainment of the rent, may distrain for the rent or any part of it remaining due, as in the case of landlord and tenant.

No provision of this section is intended to interfere with the right of the purchaser or those claiming under him to have possession of the property, except as to the part occupied by the crop, with necessary ingress or egress.

In this section the following words have the meanings indicated.

“Bona fide tenant” means a tenant under a lease or tenancy described in § 7–105.8(b)(1) of this subtitle.

“Residential property” has the meaning stated in § 7–105.1 of this subtitle.

In addition to any other notice required to be given by this Code or the Maryland Rules, the person authorized to make a sale in an action to foreclose a mortgage or deed of trust on residential property shall send, at the same time as the notice required under § 7–105.1(h)(2) of this subtitle, a written notice addressed to “all occupants” at the address of the residential property in substantially the following form:

The written notice required by this subsection shall be:

The outside of the envelope containing the written notice required by this subsection shall state, on the address side, in bold, capitalized letters in at least 12 point type, the following: “IMPORTANT NOTICE TO ALL OCCUPANTS: FORECLOSURE INFORMATION ENCLOSED. OPEN IMMEDIATELY.”.

In addition to any other notice required to be given by this Code or the Maryland Rules, the person authorized to make a sale in an action to foreclose a mortgage or deed of trust on residential property shall send a written notice of the sale not earlier than 30 days and not later than 10 days before the date of sale addressed to “all occupants” at the address of the residential property in substantially the following form:

The written notice required by this subsection shall be:

The outside of the envelope containing the written notice required by this subsection shall state, on the address side, in bold, capitalized letters in at least 12 point type, the following: “IMPORTANT NOTICE TO ALL OCCUPANTS: FORECLOSURE INFORMATION ENCLOSED. OPEN IMMEDIATELY.”.

In addition to any other notice required to be given by this Code or the Maryland Rules, the person who purchases residential property in a foreclosure sale shall send, after the entry of a judgment awarding possession and before any attempt to execute the writ of possession, a written notice addressed to “all occupants” at the address of the residential property in substantially the following form:

The written notice required by this subsection shall be:

The outside of the envelope containing the written notice required by this subsection shall state, on the address side, in bold, capitalized letters in at least 12 point type, the following: “IMPORTANT NOTICE TO ALL OCCUPANTS: EVICTION INFORMATION ENCLOSED. OPEN IMMEDIATELY.”.

In this section the following words have the meanings indicated.

“Bona fide tenant” means a tenant under a lease or tenancy described in § 7–105.8(b)(1) of this subtitle.

“Foreclosure sale purchaser” means any purchaser at a foreclosure sale of a mortgage or deed of trust on residential property.

“Residential property” has the meaning stated in § 7–105.1(a)(12) of this subtitle.

Conducts a reasonable inquiry as required under Maryland Rule 14–102 into:

Serves on each bona fide tenant, by first–class mail with a certificate of mailing a notice that:

Except as provided in paragraph (2) of this subsection, a foreclosure sale purchaser waives any claim to rent payments from a bona fide tenant in possession of a residential property for any period of time before the purchaser satisfies the requirements under subsection (b) of this section.

A foreclosure sale purchaser does not waive any claim to rent due and payable for use of the residential property for the 15 days immediately prior to the date that the purchaser satisfied the requirements under subsection (b) of this section.

In this section the following words have the meanings indicated.

“Certificate of property unfit for human habitation” means:

“Certificate of vacancy” means a certificate for a residential property issued by a unit of a county or municipal corporation indicating that the residential property is vacant.

The county or municipal corporation shall issue to a secured party a certificate of vacancy for a residential property if the county or municipal corporation determines that the residential property is vacant.

The county or municipal corporation shall issue to a secured party a certificate of property unfit for human habitation for a residential property if the county or municipal corporation determines in accordance with requirements of local, county, or State housing codes, that the residential property is unfit for human habitation.

A certificate of vacancy or certificate of property unfit for human habitation issued under this subsection is valid for 60 days after the date the certificate is issued.

A county or municipal corporation may charge a fee not exceeding $100 to a secured party to issue a certificate of vacancy or a certificate of property unfit for human habitation.

The record owner or occupant of a property may challenge the certificate of vacancy or certificate of property unfit for human habitation under this section by notifying the circuit court of the challenge.

A secured party filing an order to docket or complaint to foreclose based on a certificate of vacancy or a certificate of property unfit for human habitation under this section shall serve the foreclosure documents in accordance with § 7–105.1(h)(1) of this subtitle along with a description of the procedure to challenge the certificate and the form to be used to make the challenge.

If a challenge under paragraph (1) of this subsection is upheld, the secured party shall comply with the requirements of § 7–105.1 of this subtitle.

In this section the following words have the meanings indicated.

“Foreclosed Property Registry” means the Foreclosed Property Registry established by the Commissioner of Financial Regulation under subsection (b) of this section.

“Foreclosure purchaser” means the person identified as the purchaser on the report of sale required by Maryland Rule 14–305 for a foreclosure sale of residential property.

“Fund” means the Foreclosed Property Registry Fund established by the Commissioner of Financial Regulation under subsection (i) of this section.

“Local jurisdiction” means:

“Residential property” means real property improved by four or fewer dwelling units that are designed principally and are intended for human habitation.

Within 30 days after a foreclosure sale of residential property, a foreclosure purchaser shall submit an initial registration to the Foreclosed Property Registry.

The initial registration shall:

Within 30 days after a deed transferring title to the residential property has been recorded, the foreclosure purchaser shall submit a final registration to the Foreclosed Property Registry.

The final registration shall:

The Commissioner of Financial Regulation shall establish procedures that require a foreclosure purchaser, after submitting an initial registration, to submit to the Foreclosed Property Registry any change to the information required under paragraph (2)(ii)5 through 7 of this subsection within 21 business days after the change is known to the purchaser.

On receipt through the Foreclosed Property Registry of an initial registration or any change submitted under paragraph (5) of this subsection, the Commissioner of Financial Regulation shall promptly notify, by electronic means, authorized users from the county and, if appropriate, the municipal corporation in which the property is located.

The filing fees for registering a residential property are:

There is no fee for a final registration.

A filing fee paid under paragraph (1) of this subsection is nonrefundable.

A local jurisdiction may enact a local law that imposes a civil penalty for failure to register under this section in an amount not exceeding $1,000.

Subject to paragraph (2) of this subsection, a local jurisdiction that, in accordance with any applicable building code or local ordinance, abates a nuisance on a residential property registered under this section or takes action to maintain a residential property registered under this section may collect the cost associated with the abatement or other action as a charge included on the residential property’s property tax bill.

The Foreclosed Property Registry:

The Commissioner of Financial Regulation may authorize access to the Foreclosed Property Registry only to local jurisdictions, their agencies, and representatives and State agencies.

Notwithstanding paragraphs (1) and (2) of this subsection, the Commissioner of Financial Regulation or a local jurisdiction may provide information for a specific property in the Foreclosed Property Registry to:

There is a Foreclosed Property Registry Fund in the Office of Financial Regulation.

The purpose of the Fund is to support the development, administration, and maintenance of the Foreclosed Property Registry established under this section.

The Commissioner of Financial Regulation shall administer the Fund.

The Fund consists of:

In this section the following words have the meanings indicated.

“Instrument of writing” has the meaning stated in § 12–101 of the Tax – Property Article.

“Tax” has the meaning stated in § 14–801 of the Tax – Property Article.

60 days after the entry of the court order ratifying the foreclosure sale; or

If a motion is filed under Maryland Rule 2–535 before the expiration of the time period set forth in item (1) of this subsection, 30 days after the entry of a court order that resolves the motion without nullifying the ratification order.

An instrument of writing transferring the residential property has been recorded in the land records of the county in which the residential property is located before the expiration of the time period set forth in subsection (b) of this section; or

The foreclosure sale is subject to:

In this section the following words have the meanings indicated.

“Owner–occupied residential property” has the meaning stated in § 7–105.1 of this subtitle.

“Residential property” has the meaning stated in § 7–105.1 of this subtitle.

A secured party may petition the circuit court for leave to immediately commence an action to foreclose a mortgage or deed of trust on residential property on the basis that the property is vacant and abandoned as provided in this section.

On filing a petition under this section, the secured party shall send a copy of the petition to the mortgagor’s or grantor’s last known address and the record owner of the property by certified mail, return receipt requested, and first–class mail.

The circuit court shall rule on the petition promptly after the petition is filed.

The court finds that the mortgage or deed of trust on the residential property has been in default for 120 days or more in a condition on which the mortgage or deed of trust provides that a sale may be made;

The court finds that at least three of the circumstances listed in subsection (d) of this section are true as to the property;

No mortgagor or grantor has filed with the court an answer or objection setting forth a defense or objection that, if proven, would preclude the entry of a final judgment and a decree of foreclosure; and

No mortgagor or grantor has filed with the court a written statement that the property is not vacant and abandoned.

Gas, electric, sewer, or water utility services to the property have been disconnected;

Windows or entrances to the structure on the property are boarded up or closed off, or multiple window panes are broken and unrepaired;

Doors to the structure on the property are smashed through, broken off, unhinged, or continuously unlocked;

Junk, litter, trash, debris, or hazardous, noxious, or unhealthy substances or materials have accumulated on the property;

Furnishings, window treatments, or personal items are absent from the structure on the property;

The property is the object of vandalism, loitering, or criminal conduct, or there has been physical destruction or deterioration of the property;

A mortgagor or grantor has made a written statement expressing the intention of all mortgagors or grantors to abandon the property;

There is a determination that no owner or tenant appears to be residing on the property at the time of an inspection of the property by the secured party;

Two or more citations have been issued by a county or municipal corporation against the property for failure to maintain the property and a health and safety issue exists that has not been rectified;

The property has been condemned by a county or municipal corporation; or

Other reasonable indicia of abandonment exist.

If the court finds that a residential property is vacant and abandoned and the secured party filing a petition for leave to file an action for immediate foreclosure is entitled to judgment, the court shall grant the petition.

Except as provided under subsection (f) of this section, if the court grants the petition under paragraph (1) of this subsection, § 7–105.1 of this subtitle does not apply to an action to foreclose a mortgage or deed of trust on the residential property that is found to be vacant and abandoned.

A secured party filing an order to docket or complaint to foreclose based on a petition granted by a court under subsection (e)(1) of this section shall serve the foreclosure documents, accompanied by the document required under paragraph (4) of this subsection, by:

If at least two good faith efforts on different days to serve the mortgagor or grantor under paragraph (1) of this subsection have not succeeded, the secured party may effect service by:

The individual making service of documents under this subsection shall file proof of service with the court in accordance with the Maryland Rules.

The service of documents under paragraph (1) of this subsection shall be accompanied by a separate, clearly marked notice, in the form prescribed by regulations adopted by the Commissioner of Financial Regulation, that states:

Subject to the provisions of paragraph (5) of this subsection a person who has undertaken responsibility for the disbursement of funds in connection with the grant of title to property, shall mail or deliver to the vendor and purchaser in the transaction, the original or a photographic, photostatic, or similarly reproduced copy of the recorded release of any mortgage or deed of trust which the person was obliged to obtain and record with all or part of the funds to be disbursed. If the original or copy of a recorded release is not readily obtainable at the time of recording, the person may mail or deliver to the purchaser or vendor the original or a copy of the court’s recordation receipt for the release, or any other certified court document clearly evidencing the recordation of the release.

The required evidence of a recorded release shall be mailed or delivered to the vendor and purchaser within 30 days from the delivery of the deed granting title to the property. However, if the recording of the release is delayed beyond the 30–day period for causes not attributable to the neglect, omission, or malfeasance of the person responsible for the disbursement of funds, a letter explaining the delay shall be mailed or delivered to the vendor and purchaser within the 30–day period, and the person shall mail or deliver to the vendor and purchaser the required evidence of the recorded release at the earliest opportunity. The person shall follow the procedure of mailing or delivering a letter of explanation every 30 days until the required evidence of a recorded release is mailed or delivered to the purchaser and vendor.

If the person responsible for the disbursement of funds does not comply with the provisions of paragraphs (1) and (2), the vendor, purchaser, or a duly organized bar association of the State may petition a court of equity to order an audit of the accounts maintained by the person for funds received in connection with closing transactions in the State. The petition shall state concisely the facts showing noncompliance and shall be verified. On receipt of the petition, the court shall issue an order to the person to show cause within ten days why the audit should not be conducted. If cause is not shown, the court may order the audit to be conducted. The court may order other relief as it deems appropriate under the circumstances of the case.

Prior to delivery of the deed granting title to the property, the person responsible for the disbursement of funds shall inform the vendor and purchaser in writing of the provisions of this section.

Unless specifically requested to do so by either the purchaser or the vendor, a person responsible for the disbursement of funds in a closing transaction is not required to provide the purchaser or vendor with the required evidence of a recorded release if the person properly disburses all funds entrusted to him in the course of the closing transaction within five days from the date of the delivery of any deed granting title to the property.

The vendor shall bear the cost of reproducing and mailing a recorded release under this section unless the parties otherwise agree.

If a mortgage or deed of trust remains unreleased of record, the mortgagor or grantor or any interested party is entitled to a presumption that it has been paid if:

Except as otherwise provided by law, if an action has not been brought to enforce the lien of a mortgage or deed of trust within the time provided in paragraph (1) of this subsection and, notwithstanding any other right or remedy available either at law or equity, the lien created by the mortgage or deed of trust shall terminate, no longer be enforceable against the property, and shall be extinguished as a lien against the property.

Within seven days of the receipt, by the holder of the lien, of currency, a certified or cashier’s check, or money order in satisfaction of the debt, including all amounts due under the lien instruments and under instruments secured by the lien; or

Within seven days after the clearance of normal commercial channels of any type of commercial paper, other than those specified in paragraph (1), received by the holder of the lien in satisfaction of the outstanding debt, including all amounts due under the lien instruments and under the instruments secured by the lien.

In this section the following words have the meanings indicated.

“Affiliate” means any association, corporation, business trust, statutory trust, or other similar organization that controls, is controlled by, or is under common control with, a financial institution, as defined in § 1–101 of the Financial Institutions Article.

“Settlement” means the process of executing and delivering to the lender or the agent responsible for settlement, legally binding documents evidencing or securing a loan secured by a deed of trust or mortgage encumbering real property in this State.

In any consumer loan transaction in which the loan is secured by a purchase money mortgage or deed of trust on real property located in this State, on or before the day of settlement, the lender shall disburse the loan proceeds in accordance with the loan documents to the agent responsible for settlement as provided in subsections (c) and (d) of this section.

In any consumer loan transaction in which the loan is secured by a secondary deed of trust or mortgage on real property located in this State, on or before the day of funding the agent responsible for settlement may require the lender to disburse the loan proceeds as provided in paragraph (1) of this subsection.

Cash;

Wired funds;

A certified check;

A check issued by a political subdivision or on behalf of a governmental entity;

A teller’s check issued by a depository institution and drawn on another depository institution; or

A cashier’s check.

An affiliate or subsidiary of a financial institution insured by the Federal Deposit Insurance Corporation or the National Credit Union Administration Share Insurance Program; or

A mortgage company approved by the Federal National Mortgage Association and the Federal Home Loan Mortgage Corporation.

The existing lien priority of the original mortgage or deed of trust shall continue as to the principal sum secured by the mortgage or deed of trust immediately preceding the change or modification; and

The lien priority for the increase in the principal sum shall date from the date of the changed or modified mortgage or deed of trust.

In this section the following words have the meanings indicated.

“Escrow costs” means money to pay property taxes, hazard insurance, mortgage insurance, and similar costs associated with real property secured by a refinance mortgage that a lender requires to be collected at closing and held in escrow.

“Refinance mortgage” means a mortgage, deed of trust, or other security instrument given to secure the refinancing of indebtedness secured by a first mortgage or deed of trust.

“Residential property” means real property improved by four or fewer single family dwelling units that are designed principally and are intended for human habitation.

The principal amount secured by the junior lien does not exceed $150,000; and

The principal amount secured by the refinance mortgage does not exceed the unpaid outstanding principal balance secured by the first mortgage or deed of trust plus an amount not exceeding $5,000 to pay closing costs and escrow costs.

In this section the following words have the meanings indicated.

“Party claiming the right to possession” means a person or successor to any person who:

“Residential property” means a building, structure, or portion of a building or structure that is designed principally and is intended for human habitation.

“Threaten to take possession” means using words or actions intended to convince a reasonable person that a party claiming the right to possession intends to take imminent possession of residential property in violation of this section.

“Willful diminution of services” means intentionally interrupting or causing the interruption of heat, running water, hot water, electricity, or gas by a party claiming the right to possession for the purpose of forcing a protected resident to abandon residential property.

Except as provided in paragraph (2) of this subsection, a party claiming the right to possession may not take possession or threaten to take possession of residential property from a protected resident by:

If a party claiming the right to possession of residential property reasonably believes, based on a reasonable inquiry into the occupancy status of the property, that all protected residents have abandoned or surrendered possession of the residential property, the party claiming the right to possession may post on the front door of the residential property and mail by first–class mail addressed to “all occupants” at the address of the residential property a written notice in substantially the following form:

The written notice required by this subsection shall be:

The outside of the envelope containing the mailed written notice required by this subsection shall state, on the address side, in bold, capital letters in at least 12 point type, the following: “Important notice to all occupants: eviction information enclosed; open immediately.”.

If in any proceeding the court finds that a party claiming the right to possession violated subsection (b) of this section, the protected resident may recover:

The remedies set forth in this subsection are not exclusive.