Underwriting Manual: IN


Termination Or Extinguishment Of Mortgage - Statute Of Limitations

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I.C. § 32-28-4 et seq. provides the framework for the legal duration of a mortgage and the time for commencing a foreclosure action. The time determination is based upon the date that the lien was created and the maturity dates.

Mortgage Recorded Prior to September 1, 1982

If a mortgage recorded before September 1, 1982 has a maturity date (or due date), the mortgage is unenforceable after twenty (20) years from the maturity date. A foreclosure action cannot proceed after the twenty-year (20) period. I.C. § 32-28-4-1.

If the mortgage fails to include a maturity date, the twenty-year time frame starts from the mortgage's execution date. If the execution date is also omitted, the twenty-year statute of limitations begin with the recording date of the mortgage. I.C. § 32-28-4-2.

Mortgage Recorded After September 1, 1982

In 1981, I.C. 32-28-4-1 was amended to create a different statute of limitations for mortgages created after September 1, 1982 with a maturity date. The legal duration and foreclosure time period for a post- September 1, 1982 mortgage is ten (10) years from the stated maturity date. If the mortgage is silent as to a maturity date, the statute of limitations impose a twenty (20) year time period from the mortgage's execution date. I.C. 32-28-4-2. The legislature did not create a distinction between pre- and post- September 1, 1982 mortgages that failed to include a maturity date or due date for the last installment or an execution date. If a mortgage is recorded after September 1, 1982 with no maturity date and no execution date, the lien and foreclosure commencement period is twenty (20) years from the mortgage's recording dates.

Remedy for Maturity Date Omission

In 1937 and 1985, the Indiana legislature provided an avenue for the mortgagee to provide a maturity date when the recorded mortgage does not provide a due date. The mortgagee can record an affidavit within twenty (20) years of the mortgage's execution or recording date. The affidavit must show the due date for the debt or the date for the last installment. The recorded affidavit is cross-referenced with the mortgage. The affidavit will not affect the mortgage's recording date and priority. I.C. § 32-28-4-3. If the affidavit is recorded, the mortgage will expire twenty (20) years from the stated maturity date in the affidavit.