The bill, Substitute House Bill No. 5342, introduced as File No. 150, addresses the statute of limitations for mortgage foreclosures and the invalidity of undischarged mortgages. The bill sets a statute of limitations for initiating foreclosure actions on residential mortgages for one-to-four family dwellings used as the borrower's home. The foreclosure action must commence within the earliest of three time frames: (1) ten years from the date set for the last payment or the maturity date specified in the mortgage or related financial documents, unless extended by a written instrument; (2) forty years from the date the mortgage was recorded, or if unrecorded, from the date of execution, provided the mortgage does not stipulate a repayment period exceeding forty years; or (3) ten years from the date of an uncured default on any obligations under the mortgage or related documents, unless extended by a written instrument or payment on the account.

Additionally, the bill amends Section 49-13a of the general statutes by reducing the time after which an unreleased mortgage becomes invalid from twenty to ten years after the time limited in the mortgage for full performance of its conditions, or forty years from the recording of the mortgage if it does not disclose the payment or performance time. This invalidity applies if the mortgagor or those owning the mortgagor's interest have been in undisturbed possession of the property for the specified time and an affidavit stating such possession is recorded in the land records. The bill also allows the record holder of an undischarged mortgage to record a notice before the expiration of the specified time period to toll the time period for an additional ten years. The bill is effective July 1, 2024, and does not have a fiscal impact on the state or municipalities.

Statutes affected:
Raised Bill: 52-576
BA Joint Favorable Substitute: 49-13a
File No. 150: 49-13a