Chapter 5 : Mortgages

• Library: Standards for Examination of Real Estate Titles in Arkansas (2021 Ed.)

CHAPTER 5: MORTGAGES

Standard 5.1 Conveyances to Mortgagee

Where the record examined shows a mortgage, whether released or not released, and a subsequent deed from the mortgagor to the mortgagee unqualifiedly conveying the property to the mortgagee, no release is necessary because the mortgage merges with the fee.

Standard 5.2 Releases

1. Except as provided in Act 1025 of 1995, marginal releases executed by the mortgagee and attested and dated by the clerk should be accepted.⁸⁶ If not attested by the clerk, adequate proof that the release was signed by the mortgagee may be accepted.⁸⁷
2. An instrument which reasonably identifies the encumbrance to be released and which acknowledges payment or satisfaction, or expressly releases the property, and which instrument was duly acknowledged and recorded, should be accepted.⁸⁸

3. A discharge of a mortgage is sufficient notwithstanding errors in dates, amounts, book and page of record, property descriptions, names and position of parties, and other information if, considering all circumstances of record, sufficient data are given to identify with reasonable certainty the security interests sought to be discharged. A quitclaim deed is sufficient as a discharge.⁸⁹

Standard 5.3 Unrecorded Mortgages

An unrecorded mortgage is not a lien on the property, except as between the parties to the mortgage.⁹⁰

Standard 5.4 Mortgage Recorded Prior to Deed

1. The validity of a mortgage is not impaired by the fact that it was recorded prior to the recording of the instrument by which the mortgagor's ownership was acquired, except to the extent that rights of third parties may have intervened.⁹¹
2. A mortgage is valid when given by a person who then had no title but subsequently acquired it, except as to the extent of the rights of third parties.⁹²

Standard 5.5 Extensions and Modifications

The title examiner may rely upon the stated maturity date of a mortgage itself for the purpose of determining the statute of limitations unless an extension agreement is recorded or endorsed upon the margin of the record of the mortgage.⁹³ If no maturity date is stated in the mortgage, the examiner should require adequate evidence to determine whether or not the mortgage lien is still in existence.⁹⁴

An action to enforce a note payable must be commenced within five years after the due date stated in the note, or, if a due date is accelerated, within five years after the accelerated due date.⁹⁵ An action to enforce a note payable on demand...