Mortgage Payoff Procedure: These 10 Steps Make it Official

so you're ready to pay off your mortgage huh congratulations now there are some important hoops you might have to jump through to make this monumental occasion official after all that hard work and paying off your monster loan let's make sure we cross our T's and dot our eyes right I went through all of these steps about a year ago when our family paid off our mortgage early it was surprising to me how many steps there were to simply pay off a freaking debt nevertheless we followed the rules so we never had to do it again so here are the 10 steps that I recently went through to help me pay my mortgage off early and make it the real deal [Music] number one request a mortgage payoff statement I thought we could just send in the last mortgage payment and we'd be all set nope evidently need to call your mortgage company and verbally request a mortgage payoff statement now make this a fun moment for yourself this is the first time you get to say to someone for your mortgage company we'd like to pay off our mortgage today now don't be surprised if the representative isn't as enthusiastic as you are about it our rep was helpful and congratulated us on the big moment but I can tell she wasn't doing a happy dance during your phone call you'll choose a payoff good through date this essentially means that you'll need to send in your final payment prior to this date to not incur further interest charges for reference we made this phone call at the beginning of the month and set our payoff good through date for the end of the month number to pay some ridiculous fees why depending on your state there will more than likely be extra fees including and paying off your mortgage for us we had to pay a $30.00 statement fee and a 14 dollar recording fee it's just one last poke in the side from the mortgage company before they grant you your freedom number three obtain a certified check or request a wire transfer mortgage companies may not accept regular online payments or a personal check for the final payment for us we had the choice of either a certified check or a wire transfer we went to our local bank and requested a wire transfer it hit our account almost immediately and when we got home from the bank I checked online and had a lovely zero dollar balance number four inquire about your escrow balance depending on when you pay off the loan you will more than likely have an escrow balance containing funds for future payments to your homeowners insurance and property taxes ask your mortgage company about your escrow current balance and how much you'll be receiving back for us we received a check for around two grand two weeks after we paid off the loan now don't go spending this money now you're gonna need it to pay these bills manually number five contact your homeowners insurance provider now that you don't have an escrow account anymore you'll need to pay your homeowners insurance going forward reach out to your homeowners insurance provider and let them know that you've paid off your mortgage and you'll be making the payments ask them about automatic billing options so you don't accidentally miss this important payment number six contact your city or Township office just like the homeowners insurance your property taxes were paid through escrow as well now you're in charge of paying them touch base with your city offices and let them know you've paid off your mortgage and you will now be making the payments for your property tax payments our Township had a convenient online payment system that was actually pretty impressive for a government website number seven cancel your automatic mortgage payment if you don't cancel your automatic mortgage payment for the upcoming month you may accidentally pay more than you intended sign into your online account and ensure you're all set number eight adjust your budget accordingly tracking your spending and saving is even more important now that your mortgage free plan a sinking fund for your homeowners insurance and your property taxes and your monthly budget you don't want these big-ticket items to surprise you down the road this is also a time to make some big decisions about this newfound money what do you want to do with all this extra cash each month fun to think about number nine receive an official letter from your former mortgage provider around 30 days after you make your final payment and you'll receive an official letter from the mortgage company stating that your loan is paid in full you want to keep this one for your records or you can frame it like we did let me grab it real quick here dad's right here frame it or don't worry about it you can just save it just in case number 10 obtain the mortgage release documents your mortgage company will produce mortgage release documents that prove the mortgage is no more be sure to speak with your lender to understand when these documents will be sent to your County Clerk for processing you should also receive a copy of these documents that you'll keep for your records depending on your specific situation you may need to go to the county clerk to get a copy yourself all right let's recap those 10 important steps to complete when you're ready to pay off your mortgage number one request a mortgage payoff statement number two pay some more ridiculous fees number three obtain a certified check or request a wire transfer number four inquire about your escrow balance number five contact your homeowners insurance provider number six contact your city or Township office number seven cancel your automatic mortgage payment number eight adjust your budget accordingly number nine receive an official letter from your former mortgage company and number ten obtain the mortgage release documents after all these steps make sure you celebrate this huge moment with your loved ones some people live with mortgages for their entire lives but not you you are mortgage free what are you gonna do with all this money please let me know in the comments below and also let me know where you on your path to paying off the mortgage this is Andy Hill from the marriage kids of money podcast signing off carpe diem [Music]

Channel: Marriage Kids and Money

Views: 35,789

Keywords: Mortgage Freedom, Pay Off Mortgage Early, Mortgage Free, Dave Ramsey, Baby Step 6, mortgage payoff, mortgage payoff procedure, how to pay off your mortgage early, debt free

Id: 0Ubw8vBVi8U

Length: 7min 12sec (432 seconds)

Published: Fri Mar 13 2020