Mortgage Registry Tax Amended and Supplemental Mortgages
A mortgage amendment is not subjected to Mortgage Registry Tax (MRT).
A mortgage amendment is defined as any document that alters an existing mortgage and does not: (a) secure a new debt; or (b) increase the amount of an existing debt (Minnesota Statutes 287.01).
A document that does one of the following meets the definition of an amendment:
Extends time for payment of the unpaid portion of the original debt.
Changes the interest rate.
Adds additional real property as security for the unpaid portion of the debt.
Releases some of the real property encumbered by the mortgage.
Replaces all the real property encumbered by the mortgage with other real property.
Replaces the party bound by the mortgage with a new party.
Reduces the amount of debt secured by a mortgage, or in the case of a multi-state mortgage, reduces the percentage of real property encumbered by the mortgage that is located in this state.
A supplemental mortgage increases the current balance of an existing debt and is subject to MRT. Tax is due on the "new" debt being secured.
In 2016, a mortgage is recorded securing a non-revolving $1,000,000 debt.. In 2017, when the existing indebtedness is $600,000, the lender provides the borrower with an additional $ 300,000 and modifies the mortgage accordingly. Tax is due on $300,000.