You will rarely hear the term “reinscription” regarding a mortgage unless you live in Louisiana or buy or own property in that state. Louisiana requires you to inscribe your mortgage, and it's the only state in the country with this requirement. Louisiana’s laws have their basis in France, like much of the state's food and traditions. This accounts for the difference between its laws and other states’ property laws, which have their basis in England.
Reinscription has little to do with the home owner and everything to do with the lender. When someone buys a home with a mortgage, upon closing his lender must inscribe the mortgage or similar document that gives it a privilege or “first dibs” on the property in the event the home owner defaults. If the lender does not inscribe, then it could lose its first position, thus jeopardizing its ability to foreclose if a home owner defaults. Many attorneys -- especially those who live outside of Louisiana or who work on behalf of the lenders – consider this reinscription requirement outdated.
How it Works
Suppose a home owner obtains a home equity line to fix her plumbing, then she neglects to pay the plumber and that plumber inscribes a mechanic’s lien. A year goes by and the home owner misses four consecutive mortgage payments. If there is no reinscription, then the mortgage lender cannot foreclose unless it pays off the line of credit and the plumber first.
Initial Inscription Period
Typically, the initial inscription period lasts for 10 years. However, you should confirm this with the proper agency in your parish. Some parishes have extended the inscription period from 10 years to 31 or 41 years. If the mortgage still exists, which it typically does unless the home owner refinanced or sold the house, the lender must reinscribe the mortgage. In other words, it must file documentation again to reinscribe the mortgage and reassert its first place on the property if the owner defaults. Most parishes have templates entitled “Notice of Reinscription” that owners can complete and file to comply with this requirement.
Requirements for Reinscription
To reinscribe a mortgage, your lender must record a signed and notarized notice of reinscription with the parish where your home is located. The notice must state the lender’s name as it appears on the originally inscribed mortgage, the registry number and other appropriate information. The reinscription notice must also state that the mortgage is reinscribed. The reinscription period lasts as long as the initial inscription period.
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