Satisfaction of Mortgage

A Satisfaction of Mortgage is a document acquired from a lender that recognizes the mortgage as “paid in full” and returns a clear title to the real estate owner.

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After a borrower has paid the amount owed per the mortgage agreement, the lender is obligated to prepare a Satisfaction of Mortgage. From this point on, the lender no longer holds the property as security, and it must release the lien on the property.

After completed, the appropriate agency would issue a confirmation to the borrower confirming the title has been cleared, and the borrower now owns the property outright.

What Is a Satisfaction of Mortgage?

When a borrower pays off a mortgage in full, the financial institution (mortgagee) issues a Satisfaction of Mortgage. This document acknowledges all the terms of the mortgage agreement had been met.

Once the document is filed, the county registry is updated. The lien on the property is lifted, and the borrower is free to do what they want with the property.

Other Names for Satisfaction of Mortgage

Depending on your state, a Satisfaction of Mortgage may also be known as:

  • Mortgage Lien Release

  • Release of Mortgage

Who Needs a Satisfaction of Mortgage?

Any borrower would need a Satisfaction of Mortgage at the end of their term after paying off the mortgage. When there's no longer any lien on the property, the owner would be able to sell it on without condition or pledge it as collateral for personal or business borrowing.

The mortgagee must prepare, sign, and file a Satisfaction of Mortgage as soon as the mortgage is paid off. If the original lender sells the mortgage loan to another financial institution, it will fall on the new owner of the loan to issue that Satisfaction of Mortgage.

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How to Create a Satisfaction of Mortgage with 360 Legal Forms

The mortgagee must record a Satisfaction of Mortgage within a predetermined time frame upon the final mortgage payment. The lender and its legal counsel must issue a signed document to the borrower. If multiple parties are involved in the mortgage, it could take up to a few weeks to prepare the final document.

Let 360 Legal Forms help with our extensive library of attorney-vetted legal forms. The process is fast and easy. All you have to do is fill out our easy-to-understand questionnaire. Once complete, simply download your form as a PDF or Word document from your secure online account.

What Information Will I Need to Create My Satisfaction of Mortgage?

To create a Satisfaction of Mortgage, you must provide:

  • Details of the mortgage owner: The name of the financial institution that holds the mortgage.

  • Details of the payee: The name of the borrower.

  • Total mortgage amount: The amount specified in the mortgage agreement and any additional costs that may have occurred throughout the term.

  • Date of mortgage execution: The date on which all relevant parties signed the mortgage agreement.

  • Full description of the property: Including the legal description and tax parcel number.

  • Acknowledgment that all mortgage payments were made in full: The lender's recognition that all mortgage repayments were received agreed upon in the original agreement.

  • Acknowledgment releasing the lender from issuing a lien on the property: Prevents the lender from filing any future lien against the property.

  • Date signed and signatures of all involved parties: If there are multiple parties involved in the mortgage, they're all obligated to sign the Satisfaction of Mortgage.

Satisfaction of Mortgage Terms

  • Mortgagor: An entity or individual that borrows funds to purchase a property.

  • Mortgagee: A financial institution or individual that lends to a mortgagor.

  • County Recorder's Office: The body that registers all documents related to real estate in a county in the United States.

  • Notary Public: A state-appointed official who authorizes and authenticates legal documents, including those used in real estate like acknowledgments, mortgages, and deeds.

  • Lien: The right to hold a property that belongs to the borrower until the debt is satisfied.

  • Tax Parcel Number: A 10-12 digit number identifying the ownership and assessed property values for taxation purposes.

  • Consideration: The monetary amount paid by the mortgagor to the mortgagee.

Satisfaction of Mortgage Signing Requirements

Only the mortgagee has to sign a Satisfaction of Mortgage.

This is not the same as signing the deed, which only the mortgagor has to sign. In certain states, a witness must observe the signing of the deed. Currently, this applies to Michigan, Ohio, Georgia, Arkansas, Vermont, and South Carolina.

What to Do with Your Satisfaction of Mortgage

After you receive the Satisfaction of Mortgage signed by the mortgagee and notarized, you need to file it with the County Recorder's Office. The filing procedures may vary from one state to another.

When the relevant Recorder's Office registers the document, and the registry is updated, the property's lien is considered lifted.

Frequently Asked Questions

In most cases, notary publics in the United States can work with documents authorized in any state. However, you should still contact the County Clerk’s office where your property is located. They’ll be able to confirm whether it’s possible to have the document notarized in another state.

The deed of reconveyance and Satisfaction of Mortgage essentially serve the same purpose. Both documents transfer property titles to the borrower upon acknowledgment that the borrower has paid off the debt in full. The only difference is that a Satisfaction of Mortgage relies on the information in the mortgage agreement, as opposed to a deed of reconveyance and a deed of trust.

If the mortgagee fails to provide a Satisfaction of Mortgage, it can be penalized in accordance with the relevant statute. Since the lien is unreleased, the borrower or property owner won’t be able to do with the property as they see fit. If this comes to pass, the borrower can remind the lender to officially release the lien through a written Demand for Satisfaction of Mortgage, assuming that the mortgage is indeed paid off.

The blank header is a holder for the county recorder’s stamp that contains the appropriate filing number and other details necessary to registering the record. It’s not to be tampered with in any way.

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