§ 9:5390 — Amendment, renewal, or refinancing of mortgage and mortgage note

§5390. Amendment, renewal, or refinancing of mortgage and mortgage note
A. The effectiveness, validity, enforceability, and priority of a conventional
mortgage, conventional chattel mortgage, or security agreement are not adversely
affected by a change in the terms of the note or notes secured thereby, including but
not limited to such changes as an extension of the maturity of the note or notes, an
increase or decrease of the interest rate stipulated in the note or notes, or the
agreement that the unpaid accrued interest of the note or notes would be converted
to principal and thereafter bear interest. It shall not be necessary to amend the
mortgage or security agreement to reflect such changes in the terms of the note or
notes secured thereby in order to foreclose thereunder through executory process or
otherwise. However, if the mortgage or security agreement is amended to reflect
such changes, the effectiveness, validity, enforceability, and priority thereof shall not
be adversely affected.
B. When the mortgage so provides, a conventional mortgage or conventional
chattel mortgage automatically secures payment of a renewal or refinancing note or
notes delivered in substitution for the note or notes then secured by the mortgage
even though the renewal or refinancing note or notes reflect a change in the terms of
such note or notes, including but not limited to such changes as an extension of the
maturity of the note or notes, an increase or decrease of the interest rate stipulated in
such note or notes, or the fact that the unpaid accrued interest under the note or notes
has been converted to principal and will thereafter bear interest, and the
effectiveness, validity, enforceability, and priority of the mortgage shall not be
affected by the delivery of such renewal or refinancing note or notes. To the extent
that the renewal or refinancing note or notes evidence an increase in the secured
principal indebtedness (other than the increase that results from the conversion of
unpaid accrued interest to principal), the mortgage with respect to the increase in the
secured principal indebtedness shall rank from the date of the filing of an amendment
to the mortgage reflecting the execution and delivery of such renewal or refinancing
note or notes.
{{NOTE: SEE ACTS 1988, NO. 985, §2.}}

Legislative History

Acts 1988, No. 985, §1; Acts 1989, No. 137, §6, eff. June 22, 1989; Acts 2001, No. 541, §1.