Financing statements: residential real property.
Vote required
Majority
Fiscal committee
No
Appropriation
No
Current location
Judiciary
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Progress
Where this bill stands in the legislative process.
- Introduced
- Passed Senate
- Passed Assembly
- To Governor
- Became Law
Overview
This bill changes the rules about financing statements related to residential real property. It prohibits filing a financing statement against a home that is the owner’s primary residence in a way that would create a security interest in the title to that property. Anyone who knowingly files such a statement will be liable to the property owner for damages, attorney’s fees, and a civil penalty.
Key provisions
- Financing statements cannot be filed against owner-occupied residential real property to create a security interest in the title.
- A financing statement describing fixtures on residential property will only secure the goods or fixtures, not the real property itself.
- Violations of this law can result in liability for actual damages, attorney’s fees, and a civil penalty of up to $5,000.
- The bill amends the Commercial Code to clarify the responsibilities of collecting banks.
- The definition of ‘owner-occupied residential real property’ is specified as property occupied by the owner as their primary residence.
- A void financing statement will not be effective regarding the owner-occupied residential property.
Who is affected
- Homeowners
- Banks
- Lenders
- Real Estate Professionals
- Commercial Code Users
Notable changes
Bill text
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Sponsors
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1 on record
Primary sponsor
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