The Bamberger Blog » preparation clause http://www.bamberger.com/blog Tue, 07 Sep 2010 13:30:20 +0000 http://wordpress.org/?v=2.8.4 en hourly 1 Preparation Clauses in Kentucky Mortgages http://www.bamberger.com/blog/2010/03/preparation-clauses-in-kentucky-mortgages/ http://www.bamberger.com/blog/2010/03/preparation-clauses-in-kentucky-mortgages/#comments Wed, 10 Mar 2010 15:30:12 +0000 kjewell http://www.bamberger.com/blog/?p=350 Kentucky law indicates that a mortgage must contain a preparation clause signed by an attorney.  The requirement for an attorney to sign the preparation clause cannot be satisfied by having a bank employee or other loan officer sign the preparation clause. 

Aside from constituting the unauthorized practice of law, the bank employee improperly signing the preparation clauses on mortgages could subject the employee to prosecution and the bank could be subject to liability if it was aware of such activity and did not take any action to stop it.  An improper signature on a preparation clause does not necessarily invalidate the mortgage if the county clerk’s office accepts the mortgage for recording.  The recorded mortgage is still notice of the mortgage even though it fails to meet the technical requirements of the statute.

Author: Laura A. Scott (bio)
Phone: 812.452.3557
email: lscott@bamberger.com

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