§ 70D-4-301 — Effect of mortgage modification.

(1) For a mortgage modification described in Subsection (2):
(1)(a) the mortgage continues to secure the obligation as modified;
(1)(b) the priority of the mortgage is not affected by the modification;
(1)(c) the mortgage retains the mortgage's priority regardless of whether a record of the mortgage modification is recorded; and
(1)(d) the modification is not a novation.
(2) Subsection (1) applies to one or more of the following:
(2)(a) an extension of the maturity date of an obligation;
(2)(b) a decrease in the interest rate of an obligation;
(2)(c) if there is any change as specified in Subsection (2)(c)(i) through (iv) that does not result in an increase in the interest rate as calculated on the date the modification becomes effective:
(2)(c)(i) a change to a different recognized index if the previous index is no longer available;
(2)(c)(ii) a change in the differential between the index and the interest rate;
(2)(c)(iii) a change from a floating or adjustable rate to a fixed rate; and
(2)(c)(iv) a change from a fixed rate to a floating or adjustable rate based on a recognized index;
(2)(d) a capitalization of unpaid interest or other unpaid obligation;
(2)(e) a forgiveness, forbearance, or other reduction of principal, accrued interest, or other monetary obligation;
(2)(f) a modification of a requirement for maintaining an escrow or reserve account for payment of an obligation, including taxes, insurance premiums, or another obligation;
(2)(g) a modification of a requirement for acquiring or maintaining insurance;
(2)(h) a modification of an existing condition to advance funds;
(2)(i) a modification of a financial covenant; and
(2)(j) a modification of the payment amount or schedule resulting from another modification described in this Subsection (2).
(3) The effect of a mortgage modification not described in Subsection (2) is governed by other law.

Legislative History

Enacted by Chapter 482, 2025 General Session