Mortgage is paid off, now what

hohenfels

Our mortgage is paid off. 

I know we need to make sure we are paying our home insurance premiums since the mortgage company will no longer be doing that.

I know we now need to pay property taxes directly since they won't be coming out of escrow.

What about the title to the house?  Do we claim that and place it in a safety deposit box?  What is the process for doing this?




Steve

First, nice #humblebrag (and #jealous).  The title that matters is on file at the County Clerk.  What you need to make sure is that the note is cancelled (and returned to you clearly marked as such) and the lien (the mortgage) is released and filed with the County.


jimmurphy

Mortgage Burning Party, of course.


And you invite all of us!


Congratulations!


hohenfels

So, we don't need to get a copy of the title - just make sure that we have a note from the mortgagee stating that the mortgage is paid in full?  We have a letter saying the the mortgage is paid in full and that the county clerk has been notified.


Steve

No, not "a note," but The Note that you signed when you took the loan.  The Note is the instrument that is the debt and the document that gets sold from bank to bank.  The mortgage is merely the interest in your property securing the Note.  You should get the original signed Note back from the lender and confirmation of recording of the release of the mortgage from the Clerk in the near future.


conandrob240

congrats! Exciting. Now sell for a huge profit and buy something smaller, preferably somewhere warm!


truth

The lender has to send the original mortgage instrument to the Essex County Clerk for Cancellation of Record. After that is done the lender will mail to you that instrument with the cancellation information (usually in red ink) together with the original note which should be marked "paid in full". It should not take more than 60 days to have the original mortgage and original note in your hands.


Baldwin


conandrob240 said:

congrats! Exciting. Now sell for a huge profit and buy something smaller, preferably somewhere warm!

That is how the game is played. You are my hero for the day! 


truth

Actually, in Essex County, unlike the rest of the counties, this is done by the Essex County Register, not the Clerk.


conandrob240

Yup. Can't wait. Although ours won't be paid off when we go but hopefully still the profit part will be strong.

Baldwin said:



conandrob240 said:

congrats! Exciting. Now sell for a huge profit and buy something smaller, preferably somewhere warm!

That is how the game is played. You are my hero for the day! 



BG9


truth said:

The lender has to send the original mortgage instrument to the Essex County Clerk for Cancellation of Record. After that is done the lender will mail to you that instrument with the cancellation information (usually in red ink) together with the original note which should be marked "paid in full". It should not take more than 60 days to have the original mortgage and original note in your hands.

Did that change?

When my mortgage was paid off, I received a Satisfaction of Mortgage certificate which I took to the county office for filing.


truth

A Warrant of Satisfaction is used when the original mortgage can't be found. This is not unusual when the mortgage has been assigned a few times. Also when a lender has gone bankrupt and only the trustee in bankruptcy can execute a satisfaction. For a while some Courts were not allowing foreclosures if the foreclosing party could not produce the original note and mortgage.


Perseverance

This!  And congratulations!  I bought 2 years ago so I'm very jealous...

conandrob240 said:

congrats! Exciting. Now sell for a huge profit and buy something smaller, preferably somewhere warm!



kthnry

This is a huge accomplishment. Congratulations! 

I hate to rain on your parade, but please make sure your tax and insurance bills get paid in the event something happens to one of you, and/or family members know what needs to be done. Back when I lived in DC, there was a big scandal when it was revealed that a significant number of seniors lost their homes to tax lien sales due to trivial amounts of past due taxes -- even just the amount of a late fee. There are more protections in NJ, but still ...


lanky

For property taxes, if you are in Maplewood:  https://www.twp.maplewood.nj.us/tax-collector/pages/property-tax-sewer-bill-information

https://www.twp.maplewood.nj.us/tax-collector/pages/property-tax-sewer-bill-information

And to pay online:

https://wipp.edmundsassoc.com/Wipp/?wippid=0711

Note that you'll want to likely pay from a checking account to avoid added credit card fees...


hohenfels said:

Our mortgage is paid off. 

I know we need to make sure we are paying our home insurance premiums since the mortgage company will no longer be doing that.

I know we now need to pay property taxes directly since they won't be coming out of escrow.

What about the title to the house?  Do we claim that and place it in a safety deposit box?  What is the process for doing this?



Jackson_Fusion

Oh man people are going to hate this answer but....


If you’re going to have debt, mortgage debt is the one you want. It is the ONLY personal debt you have that is tax advantaged.


If you pay income tax, your effective mortgage rate is below whatever your mortgage stated rate is. Today that’s sub 4.5%.


You should pay off ALL OTHER debt before paying off the mortgage. In fact, I’d even go as far as to take out another mortgage (assuming I had no financial difficulties) and invest the proceeds in something relatively safe. You have a massive time horizon (all else equal, the term of the loan) so you could actually take a bit of risk with the capital without blowing up.


Notice this is VERY different from levering the hell out of yourself and hoping the market bails you out. I understand why people would blanch at the  very notion and view it as margin-like, but it’s not. I am not at all suggesting a cash out refi and using the proceeds to live la vida loca.


Again- you pay sick taxes living here. This is the ONE tax advantaged debt you’re allowed. As long as mortgage rates are low (they are) you can work a sort of carry trade just like the banks do. At the very least make sure you extinguish all other high-interest rate debt.


Not an advisor, this is just general info, talk to your financial pro, all other disclaimers apply.


LOST


jimmurphy said:

Mortgage Burning Party, of course.




And you invite all of us!




Congratulations!

You do not burn it! Nowadays the Mortgage holder usually signs the Cancellation at the bottom and sends it for recording to the County Register/Clerk. But if they send it to you instead you have to take care of sending it to Register or Clerk. The Mortgage holder may also send a new document called "Discharge of Mortgage to the Register/Clerk, but if they send it to you and there is not a stamp on it showing recording by Register or Clerk (depending on County) then you have to take care of it.


truth said:

The lender has to send the original mortgage instrument to the Essex County Clerk for Cancellation of Record. After that is done the lender will mail to you that instrument with the cancellation information (usually in red ink) together with the original note which should be marked "paid in full". It should not take more than 60 days to have the original mortgage and original note in your hands.

Correct.


hohenfels said:

So, we don't need to get a copy of the title - just make sure that we have a note from the mortgagee stating that the mortgage is paid in full?  We have a letter saying the the mortgage is paid in full and that the county clerk has been notified.

"Title" is your Deed. If you do not have it you can get a copy from the Register/Clerk. If you are in Maplewood or SO, that is, Essex County, the Official is called the Register. 

That letter you received should be sufficient, but eventually you should receive the original Mortgage showing it has been Cancelled and the cancellation "recorded" in the Office of the Register or a Discharge of Mortgage showing that that has been recorded in the Office of the Register. 


LOST


truth said:

A Warrant of Satisfaction is used when the original mortgage can't be found. 

Not a "Warrant of Satisfaction". It's called a "Discharge of Mortgage". 


truth

Sorry, I miss-wrote.

Lost is not understating the need to check the mortgage document when you receive it. Once in a great while a mortgage instrument gets returned from the Essex County Register's Office for insufficient fee and does not have a cover letter stating that. The document will have a "Received" stamp on it with a current date but not "Cancelled of Record". 



LOST


truth said:

Sorry, I miss-wrote.

Lost is not understating the need to check the mortgage document when you receive it. Once in a great while a mortgage instrument gets returned from the Essex County Register's Office for insufficient fee and does not have a cover letter stating that. The document will have a "Received" stamp on it with a current date but not "Cancelled of Record". 

I understand that, but if the instrument is sent in by the mortgage holder with an insufficient fee it will be returned to the party that sent it not the homeowner. 

You are, of course, correct that the homeowner should carefully scrutinize any document they receive.


truth

The same clerk(s) who were neglecting to put cover letters explaining the deficient fee were just mailing them to the mortgagors.  Best Part: The financial section of Register's Office was keeping and cashing the checks because it was not advised of the deficiency.


LOST


truth said:

The same clerk(s) who were neglecting to put cover letters explaining the deficient fee were just mailing them to the mortgagors.  Best Part: The financial section of Register's Office was keeping and cashing the checks because it was not advised of the deficiency.

Wow! I didn't know that. Thanks.




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