It is enacted by the General Assembly as follows:

SECTION 1. Section 34-26-2 of the General Laws in Chapter 34-26 entitled "Redemption, Release, and Transfer of Mortgages" is hereby amended to read as follows:

34-26-2. Right to discharge on satisfaction of mortgage -- Escrow accounts. -- (a) Every mortgagee of real estate, his, or her, or its heirs, executors, administrators, successors, or assigns, having received full satisfaction for the money due on the mortgage, shall, within thirty (30) days after final payment, discharge the same as provided in section 34-26-3 or by separate instrument of release of the mortgage, and shall send the discharge to be recorded in the proper record book with suitable references to the original record, including the mortgagor's name and address, which shall forever afterwards discharge, defeat and release the mortgage and perpetually bar all actions to be brought thereon in any court. Upon forwarding the discharge for recording the mortgagee shall notify the mortgagor. Any mortgagor or his agent upon tendering final payment to the mortgagee in full satisfaction of the mortgage may in writing require the mortgagee to issue the discharge by separate instrument of release, directly to a designated person or real estate closing officer within the thirty (30) day period.

(b) Every mortgagee of real estate, his, or her, or its heirs, executors, administrators or successors or assigns, having received full satisfaction for the money due on the mortgage, shall, within thirty (30) days after final payment, disburse to the mortgagor any and all funds held in escrow under the terms of the mortgage.

SECTION 2. This act shall take effect upon passage.