Author Topic: Pay off Mortgage Early - Avoid Recording Fee  (Read 918 times)

Davids

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Pay off Mortgage Early - Avoid Recording Fee
« on: December 02, 2023, 08:23:08 AM »
I want to pay off my mortgage early (I know there are many pros and cons to it but do not want to get into that discussion). Right now my mortgage balance is $17K and I just want to pay it off and be done. I went to my lender's site and requested a quote and the quote included a recording fee of $60. Currently the mortgage payment is automatically deducted from my checking account each month and I can always go in the site and pay additional to the principal. I was thinking what if instead I put $16,999 toward my principal to bring the balance down to $1. Will the next month then just $1 plus whatever interest be taken from my account to close out my mortgage thus avoiding the recording fee? I hope my question makes sense, just trying to see if there is a way to save the $60.

Morning Glory

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Re: Pay off Mortgage Early - Avoid Recording Fee
« Reply #1 on: December 02, 2023, 08:28:08 AM »
Do you still have the paperwork from when the mortgage was originated? All fees should have been disclosed there. If the fee isn't listed you have a valid argument to get it waived.

NotJen

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Re: Pay off Mortgage Early - Avoid Recording Fee
« Reply #2 on: December 02, 2023, 09:23:59 AM »
Isn't the recording fee charged by your county?  You have to have the mortgage lien removed from your title.  I doubt you can get out of paying it, but definitely double check that the amount is correct for your location.

reeshau

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Re: Pay off Mortgage Early - Avoid Recording Fee
« Reply #3 on: December 02, 2023, 10:33:36 AM »
To the point about fees, are you sure they won't charge your escrow the county recording fee when you naturally roll off?

Sibley

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Re: Pay off Mortgage Early - Avoid Recording Fee
« Reply #4 on: December 03, 2023, 11:57:58 AM »
You're not going to get out of paying the recording fee. That's not something the mortgage company charges, it's the county. And the county isn't going to make any exceptions. It's $60, a one time fee. Pay up. Don't like it, shouldn't have bought the house.

Freedomin5

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Re: Pay off Mortgage Early - Avoid Recording Fee
« Reply #5 on: December 03, 2023, 01:36:47 PM »
A couple mortgage specialists Iíve worked with have recommended paying off the mortgage but not discharging it until you sell. The reason is that a free and clear title is easier to steal via a scam. With a lien still in place, it adds an extra layer of security as anyone trying to sell your house without your knowledge will still have to remove the lien, which means theyíll have to contact your bank which will hopefully catch the fraud.

We paid off our mortgage in 2017, but we havenít discharged it. It has had a balance of $0.01 for the past 5 years. It did not affect our ability to get our second mortgage on another property.

Disclaimer: Iím in Canada. Not sure if the system is similar in the US.

Villanelle

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Re: Pay off Mortgage Early - Avoid Recording Fee
« Reply #6 on: December 03, 2023, 03:12:43 PM »
A couple mortgage specialists Iíve worked with have recommended paying off the mortgage but not discharging it until you sell. The reason is that a free and clear title is easier to steal via a scam. With a lien still in place, it adds an extra layer of security as anyone trying to sell your house without your knowledge will still have to remove the lien, which means theyíll have to contact your bank which will hopefully catch the fraud.

We paid off our mortgage in 2017, but we havenít discharged it. It has had a balance of $0.01 for the past 5 years. It did not affect our ability to get our second mortgage on another property.

Disclaimer: Iím in Canada. Not sure if the system is similar in the US.

Huh.  Super interesting.  Thanks for giving me something to think about. 

AMandM

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Re: Pay off Mortgage Early - Avoid Recording Fee
« Reply #7 on: December 04, 2023, 06:34:06 AM »
I don't understand this. If the fraudster can impersonate me well enough to sell my house (yikes!), can't s/he impersonate me well enough to discharge the mortgage? Especially in these days of checkbox e-signatures.

Dicey

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Re: Pay off Mortgage Early - Avoid Recording Fee
« Reply #8 on: December 04, 2023, 10:40:02 AM »
Seems like you're being really (and unnecessarily) cheap. Think of all the money you're saving by paying off the mortgage and pull the fee from that. You presumably have better things to do with your time.

Freedomin5

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Re: Pay off Mortgage Early - Avoid Recording Fee
« Reply #9 on: December 04, 2023, 03:43:16 PM »
I don't understand this. If the fraudster can impersonate me well enough to sell my house (yikes!), can't s/he impersonate me well enough to discharge the mortgage? Especially in these days of checkbox e-signatures.

Sure. Itís possible. No one said it was foolproof. Just another layer of complexity for the potential thief. The idea is that if the thief was choosing between a house with a free and clear title and one with a lien, it would be easier to steal the free and clear one.

I wonder if it might caught sooner too. I know I would suspect something if my mortgage with the $0.01 balance suddenly disappeared from my banking app.

Mr. Green

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Re: Pay off Mortgage Early - Avoid Recording Fee
« Reply #10 on: December 05, 2023, 08:25:09 AM »
You WANT to pay the recording fee. That's so the mortgage company will have the paid off mortgage reported to your county courts that track all deeds. It creates a public record that shows, in fact, that your mortgage is paid off. Not something you want to skip out on.

Catbert

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Re: Pay off Mortgage Early - Avoid Recording Fee
« Reply #11 on: December 06, 2023, 12:45:28 PM »
I don't understand this. If the fraudster can impersonate me well enough to sell my house (yikes!), can't s/he impersonate me well enough to discharge the mortgage? Especially in these days of checkbox e-signatures.

Sure. Itís possible. No one said it was foolproof. Just another layer of complexity for the potential thief. The idea is that if the thief was choosing between a house with a free and clear title and one with a lien, it would be easier to steal the free and clear one.

I wonder if it might caught sooner too. I know I would suspect something if my mortgage with the $0.01 balance suddenly disappeared from my banking app.

I suspect that fraudsters look online to find houses at are free and clear and work from there.  Unless it's someone who knows you and knows you've let the lien linger, they aren't go look deeper.

Edited to add:  My Recorder's Office allows you to sign up to be notified if there are any changes to your title.  You could even add a relative or friend to be notified.
« Last Edit: December 06, 2023, 12:52:35 PM by Catbert »

AMandM

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Re: Pay off Mortgage Early - Avoid Recording Fee
« Reply #12 on: December 06, 2023, 02:17:06 PM »
Ah, thanks. I hadn't thought of it as a deterrent.

Davids

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Re: Pay off Mortgage Early - Avoid Recording Fee
« Reply #13 on: December 07, 2023, 04:47:06 PM »
Update: I called bank earlier this week and yes it is a fee charged by my county. With that I have officially paid off my mortgage. Woo hoo, peace of mind feels great.

 

Wow, a phone plan for fifteen bucks!