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VIDEO

The Uniform Mortgage Modification Act

Jane E Sternecky, Julia Forrester Rogers, and Thomas Bolt

The Uniform Mortgage Modification Act modernizes the law surrounding modifications of mortgages. Mortgage modifications are not uncommon: residential or commercial borrowers may avoid foreclosure by modifying their loans, construction loans may be converted to permanent loans, or credit facilities may be updated periodically to reflect changing market conditions or to substitute portions of debt. The Uniform Mortgage Modification Act is intended to provide clarity to the common law relating to mortgage modifications.  It spells out the types of modifications to a mortgage loan that will not materially prejudice interest holders and will not constitute a novation of the loan and contains a number of safe harbors which, if satisfied, will mean a mortgage modification does not materially prejudice the holders of junior interests.

Note: The Uniform Mortgage Modification Act is being presented to the ABA House of Delegate at the 2025 ABA Midyear Meeting of the House of Delegates on Monday, February 3, 2025. The related resolution is a proposal and has not yet been adopted as official policy of the American Bar Association. The content of this resolution is subject to change and does not represent the views of the ABA until formally adopted by the House of Delegates.

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