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.