Baker Donelson

An amendment to Section 11-103 of the Maryland Condominium Act, adopted by the General Assembly during 2020 legislative session, clarifies the procedures for obtaining the consent of the holders of mortgages and deeds of trust to amendments to the condominium’s declaration, where such consent it required under a condominium’s governing documents.  It is intended to address circumstances in which holders of mortgages or deeds of trust do not respond to notices of proposed amendments.  The new law provides that the condominium provide holders of mortgages and deeds of trust with a copy of the proposed amendment, and, if the holder fails to object in writing within 60 days after receiving the notice, they are deemed to have consented to the amendment.  This provision is not applicable where the proposed amendment would (1) alter the priority of the lien of the mortgage or deed of trust; (2) materially impair or affect the unit as collateral; or (3) materially impair or affect the right of the holder to exercise rights under the mortgage or deed of trust.  In those instances, express consent must still be obtained.  A similar amendment was enacted to Section 11B-116 of the Maryland Homeowner Association Act.  These new provisions take effect on October 31, 2020.

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