Nebraska Amends Provisions Regarding Security Instruments

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Nebraska recently enacted legislation clarifying the requirements for a lender to release its lien upon the satisfaction of the obligation secured thereby and receipt of a written request for release, and the consequences for failing to do so.  The provisions take effect on July 1, 2018.

Specifically, the amendments clarify that a lender must, after receipt of payment in full or performance of the secured obligation, and receipt of a written request from the borrower or borrower’s successor in interest, record a deed of reconveyance or a release or satisfaction, as applicable, in the land records.  A lender that fails to do so within sixty days after receiving payment in full or performance of the secured obligation and the requisite written request is liable to: (i) the borrower or the borrower’s successor in interest for the greater of $5,000 or actual damages, plus attorney’s fees and costs; or (ii) a successor in interest of the borrower or of a landowner, purchaser, or holder of a junior lien, if such person made the requisite written request, for actual damages plus attorney’s fees and costs.  A court may also order a reconveyance or the recordation of a release or satisfaction.

The amendments also clarify that the transfer of any secured obligation also operates as a transfer of the security of such obligation.

A copy of the amendments is available here.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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