Maryland Homeowners! There is some good news for Maryland Homeowners who wish to subordinate a second trust when refinancing their first trust. A new bill was signed by the Governor on May 2nd and enacted October 2013 . House Bill 88 (and cross-filed Senate Bill 199). This procedure is commonly known as automatic subordination. According to the adopted legislation, a mortgagor or grantor who refinances in full the unpaid indebtedness secured by a first mortgage or deed of trust encumbering or conveying an interest in residential property at an interest rate lower than provided for in the evidence of indebtedness secured by the first mortgage or deed of trust is not required to obtain permission from the holder of a junior lien with two caveats: the principal amount secured by the junior lien does not exceed $150,000 and the principal amount secured by the refinance mortgage does not exceed the unpaid outstanding principal balance secured by the first mortgage or deed of trust plus an amount to pay closing costs not exceeding $5,000.
Posted on: Thu, 16 Jan 2014 18:08:00 +0000
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