Recording Modifications in Georgia

[Chris Seveney]

The note space is truly challenging because of the state by state laws and issues. This is one reason it’s important to really understand the state

In Georgia it is strongly recommended a modification gets recorded as if the deed of trust has expired and not foreclosed on in seven years it reverts to the borrower - even if you did a mod and extended the date - make sure you record it.

Statute below:

The doctrine of reversion, as codified at O.C.G.A. § 44-14-80. Reversion applies to security deeds that have not been foreclosed within seven years after the debt secured by the deed matures. When a borrower gives a lender a security deed, the title to the property is transferred from the borrower to the lender. If a borrower pays off the debt, the lender signs a deed back to the borrower, thereby releasing the security interest. If the borrower defaults, the lender exercises the power of sale in the security deed, and auctions the property to satisfy the debt. If, however, there is no deed back to the borrower, and there is no deed under power of sale, after seven years from the maturity of the debt, the title reverts from the lender back to the borrower by operation of law under O.C.G.A. § 44-14-80. The debt is then unsecured and cannot be foreclosed pursuant to O.C.G.A. § 44-14-83.

There is a 20 yr reversion if signed under seal, but that only applies to the Note and not the Security Deed. The general rule in Georgia is that a security deed will revert seven years after its maturity. "In 1994, O.C.G.A. § 44–14–80 was modified to provide for an automatic reverter of title to land described in a security deed after seven years from the maturity date of the debt secured thereby or 20 years if the parties so expressly agree in writing in the security deed." Matson v. Bayview Loan Servicing, LLC, 339 Ga. App. 890, 891, 795 S.E.2d 195, 196 (2016). The reversion statute does provide for a longer, twenty year reversion period from the date of the deed, but only "by affirmative statement contained in the record of conveyance." O.C.G.A. § 44-14-80(a). In other words, the deed must unambiguously state that the reversion period is twenty years, otherwise it is a seven year period.