Mortgage Note Investing in Rhode Island

Rhode Island forecloses fast. Lenders exercise the power of sale in the mortgage or deed of trust without going to court (R.I. Gen. Laws tit. 34 ch. 27), and a clean file clears in roughly two to three months. There is no statutory post-sale redemption on a mortgage foreclosure — once the sale closes, title is clean. Ignore the long redemption period investors sometimes cite for Rhode Island: that one-year window is a tax-sale right, not a mortgage right, and it does not apply to a power-of-sale foreclosure.

The caution is the condominium super-lien. Under R.I. Gen. Laws §34-36.1-3.16, an association's lien for up to six months of unpaid common-area assessments takes priority over a prior recorded first mortgage or deed of trust. On a condo file, that six-month slice can prime your lien and erode recovery at the sale — price it into any association-governed collateral and pull an assessment ledger before you close.

Two more points shape the underwrite. Delinquent municipal taxes are senior to your mortgage, and a Rhode Island tax sale carries a one-year redemption accruing at 10% plus 1% per month — slow and expensive to clear if a file slips into tax delinquency, so monitor tax status. Deficiency judgments are available against the borrower, and buying or holding these notes does not require a state license. The Rhode Island thesis is speed and clean title, with the condo super-lien as the one real trap.