One of the joys of life is being a homeowner. Homes include single-family homes, duplexes, townhouses, and condominiums. For many, Florida is the perfect place to buy a second home – a vacation home. The vast majority of Florida home-buyers need to borrow money to purchase their home. When they finally pay for their home, they need to make sure mortgage satisfaction is properly filed by the lender.
The common way to finance the purchase of a new home is through a mortgage. A mortgage is a loan by a bank, a financial institution, or even a friend in which money is advanced to the homeowner. In return, the homeowner agrees to pay the loan with interest at regular installments. Typically, monthly payments for a period of years.
The homeowner also agrees that the mortgage holder can record the mortgage in the county where the home is located. Recording the mortgage is a matter of public record. This means anyone who searches your credit status or your financial status will be made aware of the loan. This can make it difficult to get a second mortgage. It can also make it harder to get credit. Homes generally can’t be sold until the mortgage is paid and the record of the mortgage is removed. The mortgage acts as a lien on the property.
The Mortgage Satisfaction Law
When the homeowner is finally able to make the last payment on the mortgage, the lender is required to formally release the mortgage. Releases are not automatic. The county court or county agency that keeps the record of the mortgages needs to be formally notified the debt has been paid.
The law on mortgage satisfactions is outlined in Florida Statute 701.04. The lender must comply with this law within a specific time period – typically 60 days from the date of the last or full payment.
- The lender must prepare the mortgage satisfaction. This document identifies the property (by address or some formal location method), the owners, the lenders, and the original amount of the mortgage. It also states that the debt has been paid in full or “satisfied.”
- The lender must properly record the mortgage satisfaction with the proper county records department. This usually requires also paying a small fee.
- The lender must make clear any liens based on the mortgage are removed.
- The lender must give the borrower notice that mortgage satisfaction has been recorded. The notice gives the borrower the chance to make sure the satisfaction was recorded correctly. An experienced Sebastian or Vero Beach mortgage satisfaction lawyer can verify the mortgage satisfaction process. If the lender failed to follow the law, the borrower has the right to file a lawsuit against the lender to force the filing of a proper mortgage satisfaction.
Once the mortgage is satisfied, you should (provided there are no other claims) now be free and clear too:
- Sell your home
- Obtain a new mortgage
- Get new credit,
- Just enjoy owning your residence
Common times to use mortgage satisfaction
There are generally three ways in which a homeowner pays off the mortgage. The first is by making all the monthly payments. The second is by obtaining another loan. The third is by selling the house and using the proceeds of the sale of the home to pay the mortgage. Typically, a title insurance company will require that the homeowner’s mortgage by paid and “satisfied” before a clear title can be given to the new homeowner. The mortgage lender for the new buyer of the home will also require that there be a mortgage satisfaction.