Homeowner Protection Act.

GENERAL ASSEMBLY OF NORTH CAROLINA
SESSION 2025
H 1
HOUSE BILL 360

Short Title: Homeowner Protection Act. (Public)
Sponsors: Representatives Reives, Winslow, Schietzelt, and Rubin (Primary Sponsors).
For a complete list of sponsors, refer to the North Carolina General Assembly web site.
Referred to: Judiciary 2, if favorable, Rules, Calendar, and Operations of the House
March 12, 2025
*H360-v-1*
A BILL TO BE ENTITLED 1
AN ACT TO CREATE ADD ITIONAL CRIMINAL PEN ALTIES FOR CERTAIN 2
FRAUDULENT INSTRUMENTS; TO ESTABLISH A F ORM OF EXPEDITED REL IEF 3
FOR VICTIMS OF A FRA UDULENT INSTRUMENT; AND TO MODIFY STATUT ES 4
AFFECTING THE RECORDING OF DEEDS AND OTHER INSTRUMENTS. 5
The General Assembly of North Carolina enacts: 6
SECTION 1. G.S. 14-122 reads as rewritten: 7
"§ 14-122. Forgery of deeds, wills and certain other instruments. 8
(a) General Fraud. – If any person, of his that person's own head and imagination, or by 9
false conspiracy or fraud with others, shall wittingly and falsely forge and make, or shall cause 10
or wittingly assent to the forging or making of, or shall show forth in evidence, knowing the same 11
to be forged, any deed, lease or will, or any bond, writing obligatory, bill of exchange, promissory 12
note, endorsement or assignment thereof; or any acquittance or receipt for money or goods; or 13
any receipt or release for any bond, note, bill or any other security for the payment of money; or 14
any order for the payment of money or delivery of goods, with intent, in any of said instances, to 15
defraud any person or corporation, and thereof shall be duly convicted, the person so offending 16
shall be punished as a Class H F felon. 17
(b) Residential Property Fraud. – In an instance where a violation of this section involves 18
the forgery of a deed, lease, will, lien, encumbrance, or other conveyance of an interest in real 19
property relating to residential property, the person so offending shall be punished as a Class D 20
felon. For the purposes of this subsection, the term "residential property" means real property 21
where an individual has resided for, consecutively or nonconsecutively, at least six months of a 22
period of 12 months immediately preceding the forgery." 23
SECTION 2. Article 4 of Chapter 47 of the General Statutes is amended by adding 24
a new section to read: 25
"§ 47-108.29. Fraudulent instruments. 26
(a) As used in this section, the following definitions apply: 27
(1) Instrument. – Any of the following: 28
a. A transfer of title to real property b y deed or other instrument 29
transferring title to real property. 30
b. A deed of trust, mortgage, judgment, lien, encumbrance, financing 31
statement, affidavit, notice, memorandum, or any other instrument that 32
establishes a security interest in real property. 33
General Assembly Of North Carolina Session 2025
Page 2 House Bill 360-First Edition
c. A contract, right of refusal, or any other instrument that purports to 1
establish an interest, encumbrance, claim, or right relating to real 2
property. 3
(2) Suspicious instrument. – An instrument purporting to affect title to real 4
property described in an order to remove the cloud from the title to real 5
property entered pursuant to this section if both of the following conditions 6
are met: 7
a. The order to remove the cloud from the title to real property remains 8
in effect. 9
b. The grantor in the instrument is not the property owner or owners 10
identified in the order to remove the cloud from the title to real 11
property. 12
(b) The actual owner of an interest in real property subject to a recorded false, fictitious, 13
or fraudulent instrument may seek expedited relief under this section by filing an action in district 14
court alleging the filing or recording of a false, fictitious, or fraudulent instrument in a public 15
record or a private record generally available to the public. Upon receipt of a verified filing, the 16
clerk of superior court shall record, or cause to be recorded and indexed, a memorandum of 17
possible fraud in the records of the clerk of court or re gister of deeds where the alleged false, 18
fictitious, or fraudulent instrument was recorded. The notice shall be served and proof of service 19
shall be made in any manner provided by the Rules of Civil Procedure for service of summons, 20
including service by re gistered mail or certified mail, return receipt requested to all persons 21
claiming an ownership interest in the property, any lienholder of record, including any person to 22
whom a security instrument directs notice to be sent and any person obligated to repa y th e 23
indebtedness secured by the instrument. Once service has been made, the court shall convene a 24
hearing. For purposes of the notice requirement in this subsection, the party seeking relief may 25
serve the person listed as grantor in the recorded purportedly false, fictitious, or fraudulent 26
instrument at the address listed in the instrument. If the court finds that there is no statutory, 27
contractual, or other merited legal justification for the instrument, the court shall find that the 28
recorded instrument is false and is void as a matter of law and shall enter an order to remove the 29
cloud from the title to the real property. The submission of an original instrument demonstrating 30
source of title, affidavit, or a lis pendens, notice of previous fraud, or other similar instrument 31
recorded by the actual owner of an interest in the real property shall be considered evidence of 32
fraudulent activity. The court may also include in the order any of the following types of relief: 33
(1) Grant to a prevailing party possession of the real property and order the 34
ejectment of any party on the premises. 35
(2) Award attorneys' fees and other costs for the action to the prevailing party. 36
(3) Upon a finding by the court that an action filed under this section is frivolous 37
or malicious, assess a civil penalty of not more than ten thousand dollars 38
($10,000), of which the clear proceeds assessed under this subdivision shall 39
be remitted to the Civil Penalty and F orfeiture Fund in accordance with 40
G.S. 115C-457.2. 41
(4) Upon a finding by the court that a party has presented for filing or recording 42
a false, fictitious, or fraudulent instrument as described in this section more 43
than once, enter a pre-filing injunction against the party. 44
(5) Enjoin a party from listing the real property for sale, lease, or any other similar 45
advertisement. 46
(c) Upon being presented with an order duly issued by a court of competent jurisdiction 47
of this State declaring that a n instrument already recorded is false and void as a matter of law, 48
the register of deeds or clerk of superior court that received the recording shall record and 49
cross-index the court's order finding the instrument to be false. The register of deeds or clerk of 50
superior court may also conspicuously mark on the first page of the original record previously 51
General Assembly Of North Carolina Session 2025
House Bill 360-First Edition Page 3
recorded the following statement: "THE CLAIM ASSERTED IN THIS DOCUMENT IS FALSE 1
AND IS NOT PROVIDED FOR BY THE GENERAL LAWS OF THIS STATE." 2
(d) The presentation of an instrument for recording with a register of deeds or a clerk of 3
superior court that is determined to be materially false, fictitious, or fraudulent shall constitute a 4
violation of G.S. 75-1.1. 5
(e) A suspicious instrument that has been recorded after the entry of an order to remove 6
the cloud from the title of the real property is declared void and unenforceable as a matter of law 7
with respect to real property described in the instrument in the order. When presented with a 8
suspicious instrument, the register of deeds or the clerk of court may do any of the following: 9
(1) Refuse to record the instrument in accordance with G.S. 14-118.6. 10
(2) Require verification by an attorney licensed in this State that the instrument is 11
legally authorized in substance and in form under a specified statute. 12
(3) Notwithstanding G.S. 161-22, refuse to index the instrument in the name of 13
the non-signing owner of the property solely because the non -signing owner 14
is referenced in the instrument. 15
(f) No fee shall be charged for the recording of a memorandum of possible fraud or an 16
order declaring a recorded instrument to be false submitted in accordance with this section. 17
(g) The recordation of a memorandum of possible fraud under subsection (b) of this 18
section shall automatically stay any proceedings involving the real property for a period of 60 19
days from the recording of the memorandum of possible fraud or the recordation of an order 20
declaring the recorded instrument false and void as a matter of law, whichever occurs first. 21
(h) The Administrative Office of the Courts shall develop a form for the expedited relief 22
filing and memorandum of possible fraud established by this section, and the clerk of superior 23
court shall make the form available for a petitioner. In addition to the require ments set forth in 24
this section, the form shall include clear language notifying the filing party that providing false 25
information or statements is perjury pursuant to G.S. 14-209 and punishable as a Class F felony." 26
SECTION 3. Article 4 of Chapter 47 of the General Statutes is amended by adding 27
a new section to read: 28
"§ 47-108.30. No presumption of priority for certain recorded instruments. 29
A deed or conveyance of an interest in real property shall not have a presumption of priority 30
based upon the time of registration and shall not constitute color of title if any of the following 31
criteria are met: 32
(1) The deed or conveyance does not comply with the provisions of G.S. 47-18, 33
47-20, 47-118, 47-119, 47-119.1, or 47-120, as applicable. 34
(2) The deed or conveyance does not contain a signature and acknowledgement 35
of at least one record owner at the time the conveyance is made." 36
SECTION 4. G.S. 105-303 reads as rewritten: 37
"§ 105-303. Obtaining information on real property transfers; permanent listing. 38
(a) To facilitate the accurate listing of real property for taxation, the board of county 39
commissioners may require the register of deeds to comply with the provisions of subdivision 40
(a)(1), below, or it may require him to comply with the provisions of subdivision (a)(2), below: 41
(1) When any conveyance of real property (other than a deed of trust or mortgage) 42
is recorded, the board of county commissioners may require the register of 43
deeds to certify to the assessor: 44
a. The name name, residence address, and, if applicable, current mailing 45
address of the person conveying the property. 46
b. The name and name, residence address, and, if applicable, current 47
mailing address of the person to whom the property is being conveyed. 48
c. A description of the property sufficient to locate and identify it. 49
d. A statement as to whether the parcel is conveyed in whole or in part. 50
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(2) When any conveyance of real property (other than a deed of trust or mortgage) 1
is submitted for recordation, the board of county commissioners may require 2
the register of deeds to refuse to record it unless it has been presented to the 3
assessor and the assessor has noted thereon that he has obtained the 4
information he desires from the conveyance and from the person recording it. 5
(b) The board of commissioners of each county must install a permanent listing system. 6
Each county must obtain the approval of the Department of Revenue for its permanent listing 7
system. Under such a system the provisions of subdivisions ( b)(1) through (b)(4) of this 8
subsection apply. 9
(1) The assessor is responsible for listing all real property on the abstracts and tax 10
records each year in the name of the owner of record as of the day as of which 11
property is to be listed under G.S. 105-285. 12
(2) Persons whose duty it is to list real property under the provisions of 13
G.S. 105-302 are relieved of that duty, but annually, during the listing period 14
established by G.S. 105-307, these persons must furnish the assessor with the 15
information concerning improvements on and separate rights in real property 16
required by G.S. 105-309(c)(3) through (c)(5). 17
(3) The penalties imposed by G.S. 105-308 and 105-312 do not apply to failure 18
to list real property for taxation, but they apply to failure to comply with the 19
provisions of subdivision (b)(2) of this subsection with respect to reporting 20
the construction or acquisition of improvements on and separate rights in real 21
property. In such a case, the penalty prescribed by G.S. 105-312 shall be 22
computed on the basis of the tax imposed on the improvements and separate 23
rights. 24
(4) The Department of Revenue may authorize the board of county 25
commissioners to make additional modifications of the listing requirements 26
of this Subchapter, as long as the modifications do not conflict with 27
subdivisions (b)(1) through (b)(3) of this subsection." 28
SECTION 5. Article 2 of Chapter 161 of the General Statutes is amended by adding 29
a new section to read: 30
"§ 161-32. Title certification. 31
(a) Title Certification. – The board of commissioners of a county may, by resolution, 32
require the register of deeds not to accept for registration one or more types of conveyances of 33
real property unless the county tax assessor has certified that the grantors on the instrument are 34
consistent with the listing for the real property in the county tax records or, in the event of an 35
inconsistency, legal verification satisfactory to the county tax assessor has been provided for the 36
source of title, including, but not limited to, deed, will or other inheritance through an estate, or 37
a court order. The county commissioners may describe the form the certification must take in its 38
resolution. 39
(b) Exception to Title Certification. – If a board of county commissioners adopts a 40
resolution pursuant to subsection (a) of this section, notwithstanding the resolution, the register 41
of deeds shall accept without certification a conveyance s ubmitted for registration under the 42
supervision of a closing attorney and containing this statement on the deed: "This instrument 43
prepared by: ________, a licensed North Carolina attorney, based upon satisfactory verification 44
of vesting of record title to the property herein through the source of title referenced herein." 45
(c) As used in this section, the term "conveyance" means a transfer of title to real property 46
by deed, devise, or other similar instrument." 47
SECTION 6. Sections 1 and 2 of this act become effective December 1, 2025, and 48
apply to offenses committed on or after that date. Sections 3 and 4 of this act become effective 49
July 1, 2025, and apply to instruments and documents presented for registration on or aft er that 50
date. The remainder of this act is effective when it becomes law. 51