Author Topic: Planning for the last mortgage payment?  (Read 1156 times)

Harper

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Planning for the last mortgage payment?
« on: December 01, 2019, 11:51:01 AM »
I tried poking around her to see if someone has talked through the steps of making the last mortgage payment and couldn't find anything.  I know you need to call your lender and find out what the absolute total is before the payment but could anyone lend a hand for things I should do? 

Thanks!


Trifecta

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Re: Planning for the last mortgage payment?
« Reply #1 on: December 01, 2019, 12:05:22 PM »
Congrats!

1. Contact your lender as you mentioned to get the final amount to pay. Your lender may show this amount in your online account.

2. Let your homeowners insurance company know.

3. Plan to pay your future property taxes on your own.

4. Expect a check from your lender for any remaining escrow balance.

5. Give yourself a high five!



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Trifecta

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Re: Planning for the last mortgage payment?
« Reply #2 on: December 01, 2019, 12:11:38 PM »
Oh and #6:

Bump up your retirement account contributions and/or pay down any other debt!

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secondcor521

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Re: Planning for the last mortgage payment?
« Reply #3 on: December 01, 2019, 12:28:53 PM »
You can also just overpay it by $100 or whatever.  They'll figure it out and send you a refund for any excess.

Also good practice to check with your local property records (probably your county) and make sure they've recorded that the mortgage deed or lien is no longer there.

Also good practice to make sure the lender sends you a letter showing that the mortgage has been paid off.

It's implied in the list above, but be ready to pay your home insurance on your own as well.

You can also consider reevaluating your home insurance to make sure it fits your risk profile.  Check your deductibles.

Harper

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Re: Planning for the last mortgage payment?
« Reply #4 on: December 01, 2019, 02:02:01 PM »
Thanks both!  Should I be expecting a deed at some point? Do I need to request?

Trifecta

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Re: Planning for the last mortgage payment?
« Reply #5 on: December 01, 2019, 02:23:44 PM »
Our lenders have sent them to us automatically. But it wouldn't hurt to ask your lender when you can expect it.

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secondcor521

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Re: Planning for the last mortgage payment?
« Reply #6 on: December 01, 2019, 02:26:15 PM »
Thanks both!  Should I be expecting a deed at some point? Do I need to request?

Not sure on the terminology.  Where I live, from what I understand, the fact that I own my house is just recorded in the county records.  I never have, and never will receive, any sort of paper showing it's mine (as happens with a car, which is referred to around here as the title).  Even if I requested one.

What I have received is a letter from the lender saying "Congratulations, you paid off your mortgage!"  And the fact that I owed them was recorded with the county also (around here that is called a mortgage lien), and they also record the removal of the lien.

That's another reason to overpay a bit.  With my mortgages, they actually charge me a $60 fee for their work to let the county know to remove the lien.  This is sometimes called a reconveyance fee.

The removal of the lien can take a few weeks to a few months to get recorded with the county recorder.

FWIW, I've never had any problems with the liens getting put onto or removed from my properties, but it's good to be sure to check and make sure things are done correctly at the time.  Otherwise you run the risk of having an erroneous lien being on your property years later, when it is much harder to track down the paperwork and straighten stuff out.  If it crops up when you're trying to sell the house, that could delay or derail a potential sale.

I've also never had to do anything with the "Congrats" paperwork from the lender, but they don't take up much room in my filing cabinet, so I hold on to them.

kendallf

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Re: Planning for the last mortgage payment?
« Reply #7 on: December 01, 2019, 02:38:32 PM »
Otherwise you run the risk of having an erroneous lien being on your property years later, when it is much harder to track down the paperwork and straighten stuff out.  If it crops up when you're trying to sell the house, that could delay or derail a potential sale

I refinanced our house around 2006, during the crazy mortgage years, and got a HELOC from the same lender (Countrywide) because "why not".  I never took a draw on it.  About two years later the property value declined along with most of the country and the lender sent me a letter saying they had closed the HELOC for this reason. 

Fast forward to 2016 and I was preparing to sell that house; only to find out that the lien remained on the property.  Countrywide had been folded into BaA, I had refinanced a couple of times in the intervening years, and nobody would admit to any knowledge of that loan.  It took a while but I finally got a letter from BoA and filed with the county to get the lien removed.  Painful.

seemsright

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Re: Planning for the last mortgage payment?
« Reply #8 on: December 01, 2019, 03:28:16 PM »
We were able to pay ours off in full at the local bank. They had the intern do the process...because the manager said she would never see it again so take notes. It threw the entire bank into a frenzy and it took a ton of time.

The number one thing I recommend is to make sure you calculate your own escrow and make sure you set that money aside on your terms.

Congrats. 

Capsu78

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Re: Planning for the last mortgage payment?
« Reply #9 on: December 03, 2019, 02:55:57 PM »
I made the regular payment as normal as I didn't see any advantage in winding the close out with my final regular payment.
I then told the CU I wanted to pay off balance on the following business Friday.  Please email me the payoff calculations.
I then moved the money into place in the CU so that it had a couple days to clear. 
Called on Friday to say "Go" and it was as simple as flipping a switch.