Mortgage Law Summary - 2023 - Oklahoma

• Library: Mortgage Law Summary - American College of Mortgage Attorneys
• Year: 2023
• Published date: 01 September 2023

OKLAHOMA

FORM

SECURITY INSTRUMENT USED: A mortgage is the basic instrument used to secure a lien on real property. An absolute deed, intended as security for the payment of money, is deemed to be a mortgage. 46 Okla. Stat. § 1. Deeds of trust are subject to mortgage laws. 46 Okla. Stat. § 1.1. Contracts for deed are deemed to be mortgages and subject to rules of foreclosure. 16 Okla. Stat § 11A.

RECORDING REQUIREMENTS: Satisfaction of Mortgage Tax and Mortgage Certification Fee. 68 Okla. Stat. §§ 1904 and 1907. Acknowledgment of signature(s). 16 Okla. Stat. § 26. A legal description of the subject property. 19 Okla. Stat. § 298. The printed or typed name of the signer of the instrument under the signature (but failure to include will not affect validity or recordation). 19 Okla. Stat. § 261. Address of grantee, mortgagee, assignee or other party to which the instrument is to be delivered after recording. 19 Okla. Stat. § 298. Oklahoma has adopted the Uniform Real Property Electronic Recording Act, permitting digital recording and electronic signatures. 16 Okla. Stat. § 86.1 et seq.

STATUTES TO BE WAIVED: Foreclosure can occur with or without appraisement. 46 Okla. Stat. § 4. The mortgage instrument should include an appropriate provision authorizing the mortgagee to make such election at the time judgment is entered in the foreclosure action. Id. If foreclosure occurs subject to appraisement, the property must be sold for not less than ²/₃ of the appraised value. 12 Okla. Stat. § 762. If the appraisement is waived, such minimum bid requirement will not apply to the sale, but the sale must be delayed for 6 months following the entry of judgment in the foreclosure action. 12 Okla. Stat. § 760 et seq; 46 Okla. Stat. § 4.

UNUSUAL TREATMENT OF STANDARD PROVISIONS: Specific procedural requirements related to notice are required to enforce nonjudicial power of sale. Specific bold and underlined Notice of Power of Sale language is required (See Foreclosure procedures below). 46 Okla. Stat. § 40 et seq. Specific language entitling mortgagee to appointment of a receiver in the event of default pursuant to 12 Okla. Stat. § 1551 is recommended.

SECURING FUTURE ADVANCES: Obligatory future advances take priority of mortgage as of the date of initial perfection of the mortgage only to extent obligation to advance is enforceable by mortgagor under contract law and the mortgage contains an appropriate future advance clause. Optional advances take priority as of dates of advances.

TRUSTEE UNDER DEED OF TRUST: N/A.

FORECLOSURE

BRIEF DESCRIPTION OF PROCEDURE: Mortgage on real estate can be judicially foreclosed in the district court of the county in which the real property is located. 12 Okla. Stat. §§ 131 and 686. Property must be appraised, unless waived, and if not waived, may not be sold for less than ²/₃ of its appraised value. (See Statutes to be Waived, supra, re: sale with or without appraisement). Sale cannot be held sooner than 30 days after first publication of notice of sale. 46 Okla. Stat. § 45. Order of sale must conform to judgment. 12 Okla. Stat. § 760-65. Party for whom judgment rendered is entitled to reasonable attorney’s fee. 42 Okla. Stat. § 176. Sale must be confirmed by the court. 12 Okla. Stat. § 765. Sheriff executes foreclosure deed. 12 Okla. Stat. § 766.

Mortgage can be nonjudicially foreclosed pursuant to the Oklahoma Power of Sale Mortgage Foreclosure Act, 46 Okla. Stat. § 40 et seq. Such power must be granted by the mortgagor to the mortgagee in the mortgage. 46 Okla. Stat. § 43(A)(1). In order for the power to be enforceable, the mortgage must state in bold and underlined language, substantially the following:

A POWER OF SALE HAS BEEN GRANTED IN THIS MORTGAGE. A POWER OF SALE MAY ALLOW THE MORTGAGEE TO TAKE THE MORTGAGED PROPERTY AND SELL IT WITHOUT GOING TO COURT IN A FORECLOSURE ACTION UPON DEFAULT BY THE MORTGAGOR UNDER THIS MORTGAGE.

46 Okla. Stat. § 43(A)(2)(a). See discussion of waiver of appraisement under Form, supra.

REDEMPTION PERIOD AND PRICE: For judicial foreclosures, the redemption period ends upon confirmation of sheriff’s sale. 42 Okla. Stat. § 18-20; Lincoln Mortg. Invs. v. Cook, 1982 OK 137, 659 P.2d 925. For nonjudicial foreclosures, the debtor may not redeem the property after completion of sale. 46 Okla. Stat. § 43B. Debtor must tender the principal debt and interest accrued thereon to redeem the property, but, absent a contractual obligation, is not required to tender attorney’s fees and costs in order to redeem. 42 Okla. Stat. § 20.

DEFICIENCIES: No deficiency order shall be rendered except upon motion and notice filed within 90 days after date of sale. Deficiency order is: (a) amount of order with interest, plus costs and disbursements of action and amount owing on all prior liens and encumbrances with interest, less (b) market value or sale price of subject property, whichever is higher. 12 Okla. Stat. § 686.

EFFECT OF FORECLOSURE ON LEASES: If lessee is joined as defendant and holds interest with junior priority...