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Satisfaction, Release or Cancellation of Mortgage

This form is for the satisfaction or release of a mortgage.  Download the form required by your State. Free law summaries are available for all States. Try our new Satisfaction of Mortgage Forms Package and Save!



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    A mortgage satisfaction form is a legal document that results in mortgage release or mortgage discharge. Once your mortgage is paid up, it is important that there is legal acknowledgment of it. This can be done by filing a document that acknowledges that the mortgage has been fully paid. Filing such a document is called satisfaction of mortgage. If you have cleared a debt, a mortgage satisfaction document will give you clear title to real property. In other words, mortgage satisfaction is a document that results in release or discharge of a mortgage lien, and indicates that a borrower has cleared his/her debt.

    A mortgage satisfaction document is referred to by different names in various states. It may be called a satisfaction, a cancellation, a deed of reconveyance or reconveyance, discharge of mortgage or release of mortgage. Click here to view our state specific sample mortgage satisfaction forms.

    After satisfaction of mortgage, a borrower will start being responsible for his/her own taxes. In order to ensure release from mortgage, a borrower should ensure that the lender has filed a satisfaction, so that the borrower will receive a Statement of Account (SOA). The release is also noted in public land records.

    A deed of trust works similarly. Once a borrower pays a deed of trust in full, a mortgage holder is bound to file a cancellation of deed of trust that will indicate that the trustee's deed holds no lien on property.

    In order to be valid, a mortgage satisfaction should be signed by a lender and filed with the County Recorder or Recorder of Deeds. It can also be recorded with the City Registrar. In the event a lender does not sign and/or record a mortgage satisfaction within statutory time limits, s/he can be made liable for damages.

    Mortgage satisfaction can also be marginal satisfaction. Although, this process is being phased out, it continues to be recognized in some states. Marginal satisfaction happens when a mortgage holder personally visits a county recorder and enters a satisfaction on the recorded mortgage. This satisfaction is then attested by the clerk.

    If you are not in a position to make full payment of debt, you can proceed with partial payment. Therefore, if a borrower cannot pay the debt in full, s/he can make payment in an amount that is less than full satisfaction of a mortgage or deed of trust. This may result in partial release from mortgage when multiple units are covered.

    Before entering into any mortgage, a lender may request an estoppel certificate be signed by a tenant. A certificate of estoppel is a document that establishes the terms of a mortgage. Parties signing an estoppel certificate cannot later withhold rent or dispute or contradict the terms of mortgage. A mortgagee issues the certificate to a mortgagor and includes details like unpaid balance of principal, interest rate of mortgage, etc. This will prevent claims from arising at a later stage. Click here to view our sample estoppel certificates.

    Mortgage Satisfaction FAQs

    Who is a mortgagor?

    A mortgagor is a person who borrows money from a lender in order to purchase a property. A mortgagor gives the mortgagee a security interest in the property to back the loan. A mortgagor can be an individual or an entity.

    Who is a mortgagee?

    A mortgagee is a person who lends money to a borrower, and the mortgagee holds a lien on the borrower's property through a mortgage document. A mortgagee can be an individual or an entity like a bank.

    What is mortgage satisfaction?

    Mortgage satisfaction is the process of acknowledging that a mortgage has been paid off in full. It gives a borrower a release from mortgage. A mortgage satisfaction document is a legal document that evidences mortgage release. It is also called a deed of reconveyance, satisfaction, cancellation or discharge of mortgage, or release of mortgage.

    What happens when a deed of trust is paid in full?

    After borrowers pay off a deed of trust, the mortgage holder must record a cancellation of deed of trust. This will indicate that the trustee's deed does not have a lien over the mortgaged property.

    What if I don't have enough funds to pay the mortgage in full? Will I derive any benefit by making a partial payment?

    If you can't pay a mortgage or a deed of trust fully, you may get a partial release. By making a partial payment, you may obtain partial release from mortgage when multiple property units are covered.

    Where should a satisfaction of mortgage be filed?

    A satisfaction of mortgage should be filed with a county recorder. Depending on your state, the office of the county recorder may be known either as County Recorder's Office, Register of Deeds, or Land Registry Office. The satisfaction of mortgage should be filed in the office where all documents relating to real property are filed.

    Will my deed be valid if it is notarized in a state where the property is not situated?

    This will depend on which state you are from. Some states do recognize deeds that are notarized by other state officials. Therefore, it's recommended to consult with the county clerk's office in the state where the land is located to ensure that the deed will be recognized.

    What is the consequence of not recording a mortgage satisfaction?

    If a purchaser pays off the debt, but does not record a mortgage satisfaction, then the lender will continue to have a lien over the mortgaged property. If a mortgage satisfaction is not recorded, mortgage discharge cannot be proved. In certain states, the lender can be fined if satisfaction is not filed within reasonable time of paying the debt in full. Even if the time limit for filing a satisfaction has passed, you should prepare a mortgage satisfaction document and get it recorded.

    As a borrower/lender, how can I protect myself from future claims on the mortgage relating to interest rate, etc?

    Having an estoppel certificate will prevent future claims from arising. An estoppel certificate will have the terms of a mortgage and will be signed by both the parties. Once you have an estoppel certificate, the terms of mortgage cannot be disputed.

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