As of January 1, 2017, the border between North Carolina and South Carolina has been
redrawn with modern technology to confirm the boundary lines established over 200
years ago. The boundary has not changed, but over time some of the markers from the
original survey have been destroyed or lost. The new state line has caused some
properties that were originally in North Carolina, to now be in South Carolina and vice
versa. This change not only affects the personal lives of the residents, but also has
some very important implications and changes for mortgage lenders and servicers.
Below are the applicable excerpts of the new laws from each state as it relates to
mortgages and deeds of trust.
South Carolina: Act No. 270 signed by the Governor on 6/10/16 and effective 1/1/17
Foreclosure of liens
SECTION 16. Article 7, Chapter 3, Title 29 of the 1976 Code is amended by adding:
“Section 29-3- 800. (A) For the counties of this State bordering North Carolina,
Oconee, Pickens, Greenville, Spartanburg, Cherokee, York, Lancaster, Chesterfield,
Marlboro, Dillon, and Horry, hereinafter referred to as the “affected counties”, the
following provisions apply to the foreclosure of liens encumbering affected lands, as
further defined and set forth in Section 30-5- 270.
(B)(1) In the event that a real estate foreclosure proceeding is instituted pursuant to
Title 29, Chapter 3 to recover the payment of money secured by mortgages and other
liens purporting to encumber property being identified as affected lands, the purported
mortgagee, through its attorney of record, shall file with the court a copy of the recorded
Notice of Boundary Clarification, along with the attorney’s certification that title to the
subject real property has been searched in the affected counties and the affected
jurisdiction, as further defined and set forth in Section 30-5- 270(B)(2) and (3)
respectively, and that all parties having an interest in the subject real property pursuant
to the muniments of title, as further defined and set forth in Section 30-5- 270(B)(9),
have been served with notice of the proceeding pursuant to the applicable procedure
below. All proceedings in the foreclosure action must be stayed until the attorney’s
certification is filed with the court.
(2) In all mortgage foreclosure actions pending on the effective date of the boundary
clarification legislation, as further defined and set forth in Section 30-5- 270(B)(6), before
any merits hearing in the case or if an order of foreclosure has been entered before any
foreclosure sale, the mortgagee shall, through its attorney of record, serve a copy of the
Notice of Boundary Clarification and filed pleadings upon any party identified on the
Notice of Boundary Clarification or known to have an interest in the subject affected
lands, not already a party to the action, by mailing the notice via certified mail or
overnight delivery to the property addresses of the subject affected lands and to all
known addresses of the parties; provided, that the notice also shall state that the party
has thirty days from the date of mailing of the Notice of Boundary Clarification to file and
serve an answer or other response to the mortgagee’s summons and complaint.
(3) In all mortgage foreclosure actions filed after the effective date of the boundary
clarification legislation, the mortgagee, through its attorney of record, shall serve along
with the summons and complaint a copy of the recorded Notice of Boundary
Clarification upon the mortgagor and all parties identified on the Notice of Boundary
Clarification or known to have an interest in the subject affected lands.
(C) If within thirty days after having been served with Notice of Boundary Clarification
as set forth in subsection (B)(1), any party served has failed, refused, or voluntarily
elected not to file a response in the foreclosure proceeding, the mortgagee, through its
attorney, shall certify that fact to the court, and the foreclosure action may proceed with
the parties being bound as any other party in the action by the judgment and order of
the court having jurisdiction over the foreclosure action; provided, however, that all
parties shall receive actual notice of any hearings and sales in the foreclosure.
(D) The court having jurisdiction over the foreclosure action shall hear and determine
any dispute concerning any party’s right, title, or interest in the subject affected lands.”
Real property recordings and filings
SECTION 17. Chapter 5, Title 30 of the 1976 Code is amended by adding:
“Section 30-5- 270. (A) For the following counties of this State bordering North
Carolina, Oconee, Pickens, Greenville, Spartanburg, Cherokee, York, Lancaster,
Chesterfield, Marlboro, Dillon, and Horry, hereinafter referred to as the “affected
counties”, the following provisions apply to a deed, plat, mortgage, security instrument,
right of way, utility right of way, or other instrument affecting real property in the affected
jurisdiction previously believed to be located in whole or in part in North Carolina and
which is determined to be located in whole or in part in South Carolina as a result of the
boundary clarification legislation.
(C) Notice of State Boundary Clarification:
(1) On the effective date of this section, with respect to preclarification title as defined
in this chapter where the instruments disclosing the muniments of title for that land were
recorded in the public land records of an affected jurisdiction or the affected counties, or
both, prior to the effective date of the clarification, the registers of deeds in the affected
counties or the clerks of court in those counties not having registers where the affected
lands are now or previously were perceived to be located, shall file the Notice of State
Boundary Clarification, as specified in this section, in the record for all affected lands.
The purpose of this notice is to alert anyone checking the title to real property that the
real property constitutes affected lands that may be affected by the boundary
clarification legislation and muniments of title for this land also may be recorded in the
public land records of an affected jurisdiction. The notice must be properly indexed,
including the correct order of indexing, in the same manner as any instrument
conveying or encumbering real property.
(2) On or before the effective date of this section, the registers of deeds or clerks
referenced above must inform attorneys and others using their offices of the
requirements of this section. The information may be provided by clerks and registers
by those means that they would normally utilize to provide general notices to users of
their services such as postings on their web pages. This information shall include a
copy of or a link to the notice of state boundary clarification form.
(3) The notice form must be substantially in the following format:
STATE OF SOUTH CAROLINA )
) Notice of South Carolina – North
COUNTY OF ) State Boundary Clarification
The undersigned Register of Deeds/Clerk of Court of the County and State set forth
above, does hereby certify, under the penalty of perjury, the following:
(1) The following described tracts or parcels constitute affected lands as defined in
Section 30-5- 270(B)(4), which may be affected by the boundary clarification legislation
effective January 1, 2017.
[Legal description, derivation (if available) and TMS#]
(2) The parties set forth below are an Owner, as defined in Section 30-5- 270(B)(11).
[List the name and address of all owners of record]
(3) The muniments of title, as defined in Section 30-5- 270(B)(9), providing the basis
for this claim of ownership, recorded in the public records of the aforesaid County and
State, are as follows:
[List the specific instrument name and recording information]
(4) Muniments of title of those claiming an interest in this land also may be recorded in
the public land records of an affected jurisdiction, as defined in Section 30-5- 270(B)(3).
Signature of Register of Deeds / Clerk of Court
Printed Name: __________________________’
(D) Policies of Title and Casualty Insurance issued prior to the effective date of the
boundary clarification legislation are enforceable according to their terms and shall
remain in effect regardless of whether the insured property has been determined to be
in another state.
(E) Clarification of the boundary does not alter, change, or affect in any manner the
sovereignty rights of federally recognized Native American tribes over tribal lands on
either side of a confirmed boundary line. Tribal sovereignty rights continue to be
established and defined by controlling state and federal law.”
North Carolina: Senate Bill 575 signed by the Governor on 6/22/16 and effective 1/1/17
PART III. INSTRUMENTS OF TITLE TO REAL PROPERTY
SECTION 3(a) The North Carolina Geodetic Survey shall record the final survey of the
confirmed boundary in the office of the register of deeds in every county in this State
where real property has been affected by the certification of the boundary. The
applicable uniform fees provided in G.S. 161-10 shall apply to the recordation of the
final survey. The register of deeds shall register and index the surveys in accordance
with the provisions of Article 2 of Chapter 161 of the General Statutes.
SECTION 3(b) For parcels of real property affected by the certification of the boundary,
situated in whole or in part within the boundaries of this State, the North Carolina
Geodetic Survey shall record a Notice of Affected Parcel in the office of the register of
deeds in the county or counties where each affected parcel is situated. The register of
deeds shall register and index the Notice in accordance with the provisions of Article 2
of Chapter 161 of the General Statutes. Notwithstanding any other provision of law to
the contrary, the register of deeds shall not collect any fees or taxes for the Notice
recorded pursuant to this subsection. The Notice shall contain at least all of the
(1) Reference to this act.
(2) The recording reference for the final survey of the confirmed boundary recorded
pursuant to subsection (a) of this section.
(3) The names of the record owners of the parcel.
(4) The property address of the parcel.
(5) A tax parcel identification number or other applicable identifier used by a county tax
office, if available.
(6) A brief description of the parcel, if available.
(7) A source deed reference for the parcel, if available.
SECTION 3(c) Title to real property previously treated as being subject to the
jurisdiction of the State of South Carolina but that is recognized as being within the
boundaries of this State as a result of the certification of the boundary is not affected by
the certification of the boundary or the recognition of the real property as being within
the boundaries of this State. All conveyances and instruments of title, of any sort, made
prior to the certification of the boundary shall be recognized and given full faith and
credit in this State according to the law, jurisdiction, and terms in effect at the time of the
conveyance in the jurisdiction the property was previously treated as being subject to.
For the purposes of this subsection, “instruments of title” means any instrument that
affects title or constitutes the chain of title to real property, including, but not limited to,
all deeds, wills, estate documents evidencing transfer of title, plats, surveys, easements,
rights-of- way, outstanding mortgages and deeds of trust, judicial orders or decrees, and
documents evidencing intestate succession.
SECTION 3(d) Liens recorded prior to the date of boundary certification with the register
of deeds or docketed with the clerk of superior court in the county in this State where
the affected parcel is situated shall attach, as a class, to the affected parcel as of the
effective date and time of the boundary certification. This class of liens shall be
assigned priority as of the date of boundary certification but shall retain the same priority
among themselves as if this subsection did not apply.
SECTION 3(e) The Commissioner of Insurance shall not take any of the following
actions with respect to a real estate title insurance company that previously operated
only in South Carolina and issued a policy of title insurance in compliance under South
Carolina law for a parcel of real estate now determined to be located wholly or partially
in North Carolina:
(1) Require a certificate of authority to do business as a real estate title insurance
company under Article 26 of Chapter 58 of the General Statutes.
(2) Take enforcement action against any title insurance company for failure to comply
with the requirements of Article 26, 27, or 28 of Chapter 58 of the General Statutes
applicable to real estate title insurance companies in North Carolina or any other
statutory or regulatory requirements applicable to all insurance companies in North
Nothing in this section is intended to prevent the Commissioner of Insurance from
entering into a memorandum of agreement with the South Carolina Department of
Insurance with respect to enforcement of South Carolina law against real estate title
insurance companies subject to this section.
PART IV. FORECLOSURE OF DEEDS OF TRUST AND MORTGAGES
SECTION 4(a) Foreclosure actions initiated on real property encumbered by a security
instrument recorded in South Carolina wherein the real property is situated, in whole or
in part, within the certified North Carolina boundaries shall be governed by the terms of
the security instrument sought to be enforced for that portion of real property recognized
as being in a different state. If the security instrument contains a power of sale clause,
the party seeking to enforce the terms of the security instrument may initiate a
foreclosure action in the county where the real property is situated pursuant to Chapter
45 of the General Statutes. A party seeking to enforce the terms of the security
instrument may also resort to judicial foreclosure, pursuant to Article 29A of Chapter 1
of the General Statutes, in accordance with the terms within the security instrument.
Judgments or orders of foreclosure entered by courts of this State are binding and
effective only with respect to the portion of real property situated within this State. Prior
to initiating an action to enforce a security instrument, the security instrument or a
certified copy shall be recorded in the office of the register of deeds for the county
where the subject property is situated. The provisions of G.S. 45-10(a) shall apply with
regard to the appointment or substitution of a trustee for any mortgage or deed of trust
foreclosed pursuant to this section.
SECTION 4(b) Notwithstanding any other provision of law to the contrary, for mortgages
foreclosed pursuant to subsection (a) of this section, a mortgagee or its successors or
assigns shall be entitled to bid at a foreclosure sale conducted pursuant to a judgment
or order of foreclosure entered by the courts of this State.
In conclusion, while these changes may only affect a few properties in each of the
border counties, mortgage lenders and servicers need to be aware of the above
applicable state requirements. Lenders and servicers should seek counsel from their
attorney if they find they have property affected by these new laws.
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