Does anyone work in real estate or mortgages? My payoff statement from my bank for my mortgage includes a “mortgage satisfaction fee”. This fee is not mentioned anywhere in my original loan paperwork, nor are any pre-payment penalties allowed. I tried to Google from my state law, and it looks like maybe the mortgagee (the bank) is supposed to pay these fees. Does anyone have any experience with this? I called my bank, waiting on their research, but wondered if anyone knows anything useful.
We paid off our mortgage a few years ago and weren’t assessed anything identified as a "mortgage satisfaction fee. I’d call the lender and ask for more information about this fee and where in the mortgage documents that it is authorized to be assessed against you, the borrower.
I don’t know the answer to your question but do want to congratulate you on paying off your mortgage.
@rosered55, I wish it was that good. I am selling my house, and while I do have equity that I will get out of the sale, it isn’t enough to buy a new place without anothet mortgage.
I’d ask the bank what authorizes the fee. It does seem like something that should have been collected at the time the mortgage was taken.
Is it a nominal fee? In the $25-$50 range? I believe it is to cover the cost of releasing the lien and recording the document showing that the mortgage debt had been satisfied. Pretty routine.
It is $57. I think that is what it covers, but I have been researching, and apparently it is against the law in some states to charge it. The lender is supposed to pay it in those cases without charging back to the borrower. Not completely against the law in my state, apparently, but there are some restrictions. I called the bank, they are looking at it. I will pay it rather than delay my close, but figured it was worth asking.
I think I had to pay once to have a HELOC that I never drew against from my title. It was a sum under $100, but details are hazy at this point.
I bet the bank will waive it if you question it, but if it really bothers you and you don’t think they should charge it, file a complaint with the consumer department at your state (may be part of the attorney general’s office, or a regulatory agency). $57 isn’t a lot, and the fee is actually paid by the bank to the state, but $57 x 1000 releases and we’re talking real money.
The mortgage company will have the obligation to release the lien whether or not they collect the fee once the mortgage is paid. The speed at which they release it may come into play.
Do I really care how soon they release the lien? That seems to be part of our state legislation – if we requested that they release it in 10 days, borrower pays the fee. If we are wiling to wait 45 days, lender has to pay it. I don’t think I care. Do I?
I don’t see how it would impact you if you are selling. I’d be more concerned if I had paid off my mortgage and was keeping the house. The title company/closing attorney has the responsibility to ensure that the purchaser’s new mortgage is in first position.
Hmm… I do think it was the buyer’s title company that requested the payoff. Maybe they did ask for the 10 day window. (Another odd thing about this transaction – I’ve never been involved in a sale where there are two title companies. For the estate I worked on, we always put what title company we wanted in the purchase agreement documents. The house I sold before we did FSBO to friends, and used one title company)
If the buyer wants his own title policy, he can certainly buy it but usually it is just double coverage. Do you care if title is clear? Yes. You don’t know what is going to show up or what liens may get placed on it once you leave. Yes, you’ll be covered but it is a mess if things happen.
I used to have to clear title for properties owned by failed banks. Biggest problem is if they don’t get released and the bank fails or you can’t trace who owned the mortgage, it can take a long time to get the right authority to release. You don’t want your name mixed up in it.
However, if the buyer wants it released ASAP, let them pay the release charge.
I got a release of lien on a refinance from the first bank…about 3-4 months after the re-fi, I get my mail and there is a pre sort (bulk mail) envelope that says lien department(no bank name or anything) as a return address. it looks like 100% junk mail. for some reason i opened it …normally it would have gone straight to the trash. inside is a paper from my closing that I had signed, that was notarized by my lawyer and I think also the title or closing company. it was marked with some latin/legal term or something on it from the bank . it was real and was the lien release. I almost tossed it without opening it.