North Dakota mortgage law: what the state adds to the federal rules
North Dakota is the cheapest place in the country to record a mortgage — no tax on deed or note — and its judicial foreclosure comes with a 30-day cure notice, a short redemption and a ban on residential deficiency judgments. This page walks the North Dakota-specific rules in the order a borrower meets them: closing, spousal and homestead rules, costs at recording, prepayment, predatory-lending limits, licensing, disclosures and, at the end, default.
| Closing practice | Title company closing state |
|---|---|
| Community property | No — common-law (separate property) state |
| Mortgage recording tax | There is no mortgage tax, intangible tax or real estate transfer tax anywhere in North Dakota; a mortgage is recorded for a flat county recorder fee that scales with page count. |
| Transfer tax (deed) | North Dakota has no real estate transfer tax and no mortgage tax; only recording fees apply. |
| Usury ceiling | North Dakota’s usury limit is tied to a Treasury benchmark, but business-purpose loans above a threshold and loans to entities are exempt; hard money lenders lend to entities for investment purposes and confirm the exemption with counsel. |
| Foreclosure | Judicial · 4 to 8 months to sale · deficiency: barred after the usual sale |
How a North Dakota closing is conducted
North Dakota closings are handled by title or abstract companies, often the same firm that prepared the abstract of title; an attorney is optional and usually appears only to write a title opinion on older abstracts or on farmland. It is a wet-funding state, with lender funds delivered before the mortgage is recorded with the county recorder. Settlement charges are among the lowest in the country, frequently a few hundred dollars.
Spouses, community property and the homestead
North Dakota is a separate-property state; a spouse who is not a borrower is not underwritten. Because N.D.C.C. § 47-18-05 voids a conveyance or encumbrance of the homestead unless both spouses sign, every North Dakota lender requires the non-borrowing spouse to execute the mortgage. Joint tenancy is the usual form of title for married couples.
N.D.C.C. § 47-18-01 protects a homestead from general creditors up to a stated value — $100,000 for many years, a figure the Legislature revisits occasionally, so confirm the current number — without an acreage limit inside city limits. The protection does not apply against a mortgage, property taxes, or mechanic’s liens. On the tax side North Dakota created a primary residence credit in 2023 and expanded it in 2025, paid by the state against each owner-occupied home’s bill, alongside the older homestead credit for low-income owners 65 or older and people with disabilities under N.D.C.C. § 57-02-08.1.
What North Dakota charges on the note and the deed
There is no mortgage tax, intangible tax or real estate transfer tax anywhere in North Dakota; a mortgage is recorded for a flat county recorder fee that scales with page count. The absence of any tax on either the deed or the note is one reason closing costs are so low. Refinances simply pay a new recording fee and a satisfaction fee when the old mortgage is released.
North Dakota has no real estate transfer tax and no mortgage tax; only recording fees apply.
Prepayment penalty law in North Dakota
North Dakota statutes do not set out a general ban on prepayment penalties for residential mortgages, and the Department of Financial Institutions treats the question as one of contract subject to federal qualified-mortgage limits. Penalties are rare in practice because nearly all North Dakota home loans are sold to the agencies or the state-owned Bank of North Dakota programs. Verify the note and, if a penalty appears, ask the Department whether the lender’s license type permits it.
Interest caps and high-cost loan rules
North Dakota has no state high-cost home loan statute and relies on federal HOEPA and the CFPB rules for triggers. The state contribution is licensing-based: N.D.C.C. title 13 prohibits licensees from misrepresenting terms, charging undisclosed fees or engaging in fraud, and the Department of Financial Institutions can suspend a license and order refunds. Unfair-practice claims can also be brought under the North Dakota consumer fraud law, N.D.C.C. chapter 51-15.
North Dakota’s usury limit is tied to a Treasury benchmark, but business-purpose loans above a threshold and loans to entities are exempt; hard money lenders lend to entities for investment purposes and confirm the exemption with counsel.
Who regulates mortgage lenders in North Dakota
The North Dakota Department of Financial Institutions licenses residential mortgage lenders and money brokers under N.D.C.C. chapter 13-04.1 and related chapters, and mortgage loan originators under chapter 13-10, all through the NMLS. Banks, credit unions and the Bank of North Dakota are exempt, and occasional seller financing does not require a license. Consumers can look up a licensee on NMLS Consumer Access or the Department’s Bismarck office.
What North Dakota adds to the federal disclosures
North Dakota foreclosure is judicial: N.D.C.C. § 32-19-20 requires a written notice of intent to foreclose at least 30 days before suit, giving the owner that time to cure the arrears, and most residential mortgages are short-term redemption mortgages under chapter 32-19.1 with a 60-day redemption period after the sheriff’s sale. N.D.C.C. § 32-19-03 bars a deficiency judgment on a residential property of four units or fewer on 40 acres or less, which shapes how lenders price risk. Beyond those foreclosure rules the state adds no rescission or disclosure form to TRID.
Default and foreclosure: the North Dakota path
North Dakota lenders must sue in district court, but only after serving a written notice of intent to foreclose giving the homeowner at least 30 days to cure the default. Expect 4 to 8 months to a sale under this judicial process. North Dakota prohibits deficiency judgments on foreclosures of most residential property (single-family to four-family homes on small parcels). The full timeline, redemption and mediation rules are on foreclosure in North Dakota; the investor view — usury, licensing exemptions, recovery speed — on hard money in North Dakota.
Frequently asked questions
Do I need a lawyer to close a mortgage in North Dakota?
North Dakota closings are handled by title or abstract companies, often the same firm that prepared the abstract of title; an attorney is optional and usually appears only to write a title opinion on older abstracts or on farmland. Even where the state does not require one, a borrower may hire independent counsel to review the note, the security instrument and the title commitment.
Does North Dakota allow prepayment penalties on home loans?
North Dakota statutes do not set out a general ban on prepayment penalties for residential mortgages, and the Department of Financial Institutions treats the question as one of contract subject to federal qualified-mortgage limits. Whatever the state permits, the federal Closing Disclosure must state plainly whether the loan has a penalty.
What does North Dakota charge to record a mortgage?
There is no mortgage tax, intangible tax or real estate transfer tax anywhere in North Dakota; a mortgage is recorded for a flat county recorder fee that scales with page count. North Dakota has no real estate transfer tax and no mortgage tax; only recording fees apply.
Who licenses mortgage lenders in North Dakota?
The North Dakota Department of Financial Institutions licenses residential mortgage lenders and money brokers under N.D.C.C. chapter 13-04.1 and related chapters, and mortgage loan originators under chapter 13-10, all through the NMLS. Licensing is verified through NMLS Consumer Access; a company or person who cannot produce an NMLS number should not be originating a consumer mortgage.
Federal layer: TILA / Reg Z · RESPA · TRID disclosures · ECOA · Fair Housing Act · all federal regulations. Buying here: first-time buyer programs in North Dakota.