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Open-end mortgages - 42 Pa. Cons. Stat. § 8143

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     § 8143.  Open-end mortgages.
        (a)  General rule.--Whether or not it secures any other debt
     or obligation, an open-end mortgage, other than a purchase money
     mortgage as defined in section 8141 (relating to time from which
     liens have priority), may secure unpaid balances of advances
     made after such open-end mortgage is left for record. The
     validity and enforceability of the lien of an open-end mortgage
     shall not be affected by the fact that the first advance is made
     after the date of recording of the mortgage or that there may be
     no outstanding indebtedness for a period of time after an
     advance or advances may have been made and repaid.
        (b)  Unobligated advance after notice.--An open-end mortgage
     securing unpaid balances of advances referred to in subsection
     (a) is a lien on the premises described therein from the time
     the mortgage is left for record for the full amount of the total
     unpaid indebtedness, including the unpaid balances of the
     advances that are made under the mortgage plus interest thereon,
     regardless of the time when the advances are made. However, if
     an advance is made after the holder of the mortgage receives
     written notice which complies with subsection (d) of a lien or
     encumbrance on the mortgaged premises which is subordinate to
     the lien of the mortgage and if the holder is not obligated to
     make the advance at the time the notice is received, then the
     lien of the mortgage for the unpaid balance of the advance so
     made is subordinate to the lien or encumbrance unless the
     advance so made is in order to pay toward, or to provide funds
     to the mortgagor to pay toward, all or part of the cost of
     completing any erection, construction, alteration or repair of
     any part of the mortgaged premises, the financing of which, in
     whole or in part, the mortgage was given to secure. If an
     advance is made after the holder of an open-end mortgage
     receives written notice of labor performed or to be performed or
     materials furnished or to be furnished for the erection,
     construction, alteration or repair of any part of the mortgaged
     premises and if the holder is not obligated to make the advance
     at the time the notice is received, then the lien of the
     mortgage for the unpaid balance of the advance so made is
     subordinate to a valid mechanic's lien for the labor actually
     performed or materials actually furnished as specified in the
     notice unless the advance so made is in order to pay toward, or
     to provide funds to the mortgagor to pay toward, all or part of
     the cost of completing any erection, construction, alteration or
     repair of any part of the mortgaged premises, the financing of
     which, in whole or in part, the mortgage was given to secure.
        (c)  Mortgagor may limit indebtedness.--The mortgagor may
     limit the indebtedness secured by an open-end mortgage, and
     release the obligation of the mortgagee to make any further
     payments, to that in existence at the time of the delivery of a
     written notice to that effect to the recorder for record, if the
     notice is executed by the mortgagor, is acknowledged according
     to law and states the volume and initial page of the record or
     the recorder's file number of the mortgage, and a copy thereof
     is served upon the holder of the mortgage more than three days
     prior to the delivery of the notice to the recorder for record.
     The notice shall be recorded and indexed by the recorder as an
     amendment of the mortgage and shall be noted on the margin of
     the record of the mortgage, giving the book and page number
     where the notice is recorded. The right of the mortgagor to
     limit indebtedness secured by the mortgage is not applicable to
     interest subsequently accruing on indebtedness or advances made
     after the delivery of the notice to the recorder for record in
     order to pay for all or part of the cost of completing any
     erection, construction, alteration or repair of any part of the
     mortgaged premises, the financing of which, in whole or in part,
     the mortgage was given to secure.
        (d)  Notice.--The written notices provided for in subsection
     (b) shall be signed by the holder of the lien or encumbrance or
     the person who has performed or intends to perform the labor or
     who has furnished or intends to furnish materials, or by his
     agent or attorney, and shall set forth a description of the real
     property to which the notice relates, the date, the parties to,
     the volume and initial page of the record or the recorder's file
     number of the mortgage over which priority is claimed for the
     lien or encumbrance and the amount and nature of the claim to
     which the lien or encumbrance relates or the nature of the labor
     performed or to be performed or materials furnished or to be
     furnished and the amount claimed or to be claimed therefor. The
     written notices provided for in subsections (b) and (c) shall be
     deemed to have been received by or served upon the holder of the
     mortgage when delivered to the holder personally or by
     registered or certified mail at the address of the holder
     appearing in the mortgage or an assignment thereof or, if no
     address is so given, at the principal place of business or
     residence of the holder or the agent of the holder within this
     Commonwealth or, if the holder has no principal place of
     business or residence or agent within this Commonwealth, when
     posted in some conspicuous place on the mortgaged premises.
        (e)  Section not exclusive.--This section is not exclusive
     and shall not be construed to change existing law with respect
     to the priority of the lien of advances made pursuant to a
     mortgage except to the extent that it gives priority to the lien
     for advances under an open-end mortgage complying with the
     requirements of this section which would not have such priority
     in the absence of this section.
        (f)  Definitions.--As used in this section, the following
     words and phrases shall have the meanings given to them in this
     subsection:
        "Holder of the mortgage."  The holder of the mortgage as
     disclosed by the records of the recorder or recorders of the
     county or counties in which the mortgaged premises are situated.
        "Indebtedness."  The unpaid principal balance of advances
     exclusive of interest and unpaid balances of advances and other
     extensions of credit secured by the mortgage made for the
     payment of taxes, assessments, maintenance charges, insurance
     premiums and costs incurred for the protection of the mortgaged
     premises.
        "Mortgage."  Includes a mortgage, deed of trust or other
     instrument in the nature of a mortgage.
        "Mortgagor."  Includes the mortgagor's successors in interest
     as disclosed by the records of the recorder or recorders of the
     county or counties in which the mortgaged premises are situated.
        "Open-end mortgage."  A mortgage which secures advances, up
     to a maximum amount of indebtedness outstanding at any time
     stated in the mortgage, plus accrued and unpaid interest. Such a
     mortgage shall be identified at the beginning thereof as an
     "open-end mortgage" and shall clearly state that it secures
     future advances, which in the case of a home equity plan, the
     lender has a contractual obligation to make on the terms and
     conditions set forth in the mortgage and open-end loan agreement
     with the borrower. Such open-end mortgage shall be deemed to
     secure obligatory future advances even though the mortgage or
     loan agreement contains some or all of the limitations and
     conditions on the obligation to make advances which are
     permitted for home equity plans under the Home Equity Loan
     Consumer Protection Act of 1988 (Public Law 100-709, 102 Stat.
     4725), as implemented by Regulation Z issued thereunder in 12
     CFR 226.5(b) (relating to general disclosure requirements).
        "Recorder."  The recorder of deeds or other official in
     charge of recording mortgages in each county in which the
     mortgaged premises are located.
     (Oct. 12, 1990, P.L.525, No.126, eff. 60 days)

        1990 Amendment.  Act 126 added section 8143. Section 2 of Act
     126 provided that nothing contained in Act 126 shall be
     construed to affect the priority of advances made under any
     mortgage recorded before the effective date of Act 126.

Last modified: November 27, 2007