South Carolina General Assembly
110th Session, 1993-1994

Bill 1089


Indicates Matter Stricken
Indicates New Matter


                    Current Status

Introducing Body:               Senate
Bill Number:                    1089
Primary Sponsor:                Peeler
Committee Number:               02
Type of Legislation:            GB
Subject:                        Farm credit system
                                institution, mortgage
Residing Body:                  Senate
Current Committee:              Banking and Insurance
Companion Bill Number:          4511
Computer Document Number:       DKA/3179JM.94
Introduced Date:                19940127    
Last History Body:              Senate
Last History Date:              19940127    
Last History Type:              Introduced, read first time,
                                referred to Committee
Scope of Legislation:           Statewide
All Sponsors:                   Peeler
                                Courtney
Type of Legislation:            General Bill



History


Bill  Body    Date          Action Description              CMN  Leg Involved
____  ______  ____________  ______________________________  ___  ____________

1089  Senate  19940127      Introduced, read first time,    02
                            referred to Committee

View additional legislative information at the LPITS web site.


(Text matches printed bills. Document has been reformatted to meet World Wide Web specifications.)

A BILL

TO PROVIDE THAT AN ASSIGNMENT OF A MORTGAGE GIVEN TO A FARM CREDIT SYSTEM INSTITUTION NEED NOT BE RECORDED IN ORDER TO PERFECT THE ASSIGNMENT IF THE UNDERLYING NOTE HAS BEEN ASSIGNED OR TRANSFERRED ACCORDING TO STATE LAW AND IS IN THE POSSESSION OF THE ASSIGNEE, AND TO PROVIDE FOR THE MANNER IN WHICH CERTAIN COLLATERAL ASSIGNMENTS OF NOTES AND MORTGAGES ARE VALID, ENFORCEABLE, AND PERFECTED.

Be it enacted by the General Assembly of the State of South Carolina:

SECTION 1. (A) For purposes of this section:

(1) "Assignment of note" means every document endorsing, assigning, transferring, pledging, or conveying an interest in a note and mortgage securing the note, whether set forth in a separate instrument or contained in a loan agreement, financing agreement, or security agreement or given in conjunction with financing arrangements, involving Farm Credit System institutions.

(2) "Collateral assignment" means any assignment of a note and mortgage made and delivered in connection with any extension of credit involving Farm Credit System institutions, where the assignor retains the right to collect or to apply the note payments after assignment and prior to default.

(3) "Farm Credit System institution" means a Farm Credit Bank (formerly Federal Land Bank or Federal Intermediate Credit Bank), an Agricultural Credit Bank, an agricultural credit association (ACA), a production credit association (PCA), a federal land bank association (FLBA), or a federal land credit association (FLCA), chartered by the federal Farm Credit Administration pursuant to the Farm Credit Act of 1971, as amended, or an act of the United States Congress, or any successor or assignee of any of the foregoing.

(B) It is not necessary in order to perfect a valid written assignment of a mortgage or other agreement mortgaging real property or an interest in real property, which is pledged as security for an obligation involving Farm Credit System institutions, to record the written assignment in the office of the clerk of court or other recording office in the county in which the real property is located. A transfer of the promissory note or other instrument secured by the mortgage or other security instrument by an assignment of note to such an institution, which assignment of note constitutes an effective transfer or assignment under the laws of this State, constitutes an effective assignment of the mortgage or other security instrument. The assignee of the note is entitled to enforce all obligations contained in the promissory note or other agreement and possesses all of the rights of the assignor in the mortgage or other security instrument given to a Farm Credit System institution, including the right to foreclose the instrument in accordance with law without restriction. The provisions of this section do not preclude the recordation of a written assignment of a mortgage or other security instrument with or without the promissory note or other instrument that it secures.

(C) The execution of a written document containing an assignment of note is valid and enforceable from the time of execution to pass the interest granted, pledged, assigned, or transferred in the note and the mortgage securing the note as against the assignor, and the transfer is perfected from the time of execution against subsequent assignees, lien creditors, and purchasers for valuable consideration from the assignor.

(D) Where an assignment of note is a collateral assignment, after a default under the loan agreement, financing agreement, security agreement, or other evidence of indebtedness which the assignment secures, the assignee is thereafter entitled, but not required, to collect and receive any accrued and unpaid or subsequently accruing note payments and to foreclose the mortgage securing the note subject to the assignment without need for the appointment of a receiver, any act to take possession of the note, or any further demand on the assignor or maker of the note. Unless otherwise agreed, after default the assignee is entitled to notify the maker or other obligor to make payment to the assignee and is also entitled to have possession of any payments or proceeds to which the assignee may be entitled.

(E) This section does not exclude other methods of creating, perfecting, collecting, sequestering, or enforcing a security interest in notes and mortgages provided by the laws of this State.

SECTION 2. This act takes effect thirty days after approval by the Governor and applies to all assignments of notes and mortgages, including collateral assignments, involving Farm Credit System institutions executed at any time, whether before, on, or after the effective date of this act.

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