Paying off a mortgage

A few years ago, I asked for advice on purchasing a house. Back then I was nervous about qualifying for a mortgage, and I was seeking info on the pros/cons of even having a mortgage. Well, I bought the house and have lived there happily.

Well, the mortgage was taken over by Chase shortly after closing. All went smoothly until Chase f*cked up. After that issue was resolved, I was nervous and began paying even more extra toward the principal.

So, I now find myself paying off my mortgage later this year or early next year. I have a few questions:

  1. Do I need legal help doing this, or do I just mail my last payment?
  2. After I pay it off, do I get any documentation?
  3. How do I handle paying taxes without my mortgage escrow?
  4. I’m thinking about buying another house (for vacation/investment). With my primary residence paid for, will a mortgage be easy to get, with current economic climate?
  5. Any other advice?

Thanks!!!

IANAL, but I can answer a couple of questions. I think you send in your final payment (good for you, by the way!) and they should send you a settlement form, which you will take to the county tax office. Setting aside money for insurance/taxes will be easy. Since you don’t have a mortgage, just set aside a few months payment into an account and pay it when the bill arrives. (That’s how we pay taxes/insurance on our rental proprty.)

Before you jump into another investment property, I would make sure all your bills are paid off and you have at least 15% of your gross income going into a mutual fund/IRA. If you can, buy the investment property with cash, if not, don’t get more than a 15-year mortgage.

And congratulations!

Oh, and as far as tax advantages (deducting the interest you pay) you can get the same effect by donating that amount to charity. Plus, you’ll own your own home! Win/win!

Congratulations!

I can only answer your question about property taxes. In Oregon, they just mail me my property tax bill at the appropriate time, and I pay it like any other multi-thousand dollar debt - painfully and grudgingly :wink: .

I’d make sure to call the loan servicer well in advance, to make sure they’re ready. Have them tell you in writing what you need to do for them to agree the mortgage is completely paid off.

We paid off our mortgage earlier this year. I called the company and got the payoff amount for a specific date in the future (say, two weeks from now.) the interest is figured to the penny and you need to send a certified check for this amount so that it arrives in their office on or before the agreed-upon date. About 4 weeks later the local registrar of deeds got an official confirmation releasing the lien on our home. I got a letter confirming that this had been done. Next, I notified the local tax office and the insurance office that the taxes and homeowners bills were to go to me, not my mortgage company. The taxes can be paid in person or by mail to the local trustee’s office. A couple of weeks, later I got a check for the amount in my escrow account and the overage from that certified check (it arrived several days before the due date, so I had a few dollars refunded.) That was it!

Congratulations, vetbridge. I think you will like living mortgage-free.

No. But I’d call and ask for a payoff statement instead of just mailing them a check, just to be sure you aren’t paying them too much.

You want to make sure they do this:

http://members.aol.com/DKM1/21PA681.html

If they give you any crap–and they shouldn’t, it’s pretty standard–direct them to this statute:

http://members.aol.com/DKM1/21PA682.html

Nah, if you want someone to pay your taxes, talk to Johnny L.A. :wink:

I do not want to comment on whether or not you should donate to charity, but strictly from a tax standpoint you are never better off financially by spending money on something that is deductible just to get a “tax advantage.”

Here in the U.K., it is common to leave £1 - or some other minor amount - outstanding so your deeds are held in a secure place.

In his other thread vetbridge mentioned people had urged him to get a mortgage (instead of buying the house outright) for the “tax advantage.” I agree, the few bucks you get off your taxes should not be in the top 100 reasons of buying a house. But my point was, if that is a concern whether or not to pay off a house, then donating that amount to charity gives you the same benefit.

Any reputable mortgage holder (which I would like to assume includes Chase) will be intimately familiar with the need to record the “Satisfaction piece” at the appropriate Registry of Deeds, and exactly how this is done. You should certainly verify that this is completed in a timely manner (because until it is the property continues to have this lien outstanding against it).

I’ll add to the congratulations.

(All you have to do now is figure out how you’ll pay your share of the cost of bailing out all those who incurred debts they couldn’t handle.)

In the US the secure place is nearly always a public (typically, county) office usually known as the Registry of Deeds. No deed can be official and valid unless a record of it is there. And once it is recorded there, no other copy need be retained.

Not quite true. An unrecorded deed is valid, but someone who pays for an interest in the land in question won’t be bound by the deed unless it is recorded or the purchaser has notice of the deed, depending on the recording state applicable in the jurisdiction. Many jurisdictions have “notice” statutes.

http://www.intcounselor.com/real-property.html

And in just about every jurisdiction, an unrecorded deed is enforceable between the parties to the deed. See http://www.assetprotectionbook.com/2001_OH_0001549.htm

Bonus trivia: An unrecorded deed is sometimes called a “wild deed.” http://www.scribd.com/doc/210501/The-Wild-Deed-and-Real-Property-Law

A suggestion with regard to paying your property taxes (and homeowners insurance) in future years: Open a separate interest-paying account somewhere and every month deposit the same amount, or prefereably just a bit more, into that account that you had been paying into the escow account. That way you won’t find yourself suddenly having to come up with a big chunk of money once or twice a year.

heh. Back when I bought the house, my agent kept pointing out that I was approved for over 3x the amount that I was getting, as if I was somehow turning away $$$. I’m a divorced guy with 3 BRs and 2 bathrooms, on a fantastic piece of property.:smiley:

I’ve printed out this thread. Thanks to everyone for the congrats and advice! If you find yourself in the neighborhood, stop by!

I have nothing to add but my congratulations. Good for you!

You should be careful to confirm whether the bank actually records the “Satisfaction piece”, or merely sends it to you for you to record on your own. If they send it to you, make sure to record it with the county clerk, or other appropriate official.

Also, it was mentioned before, but it bears mentioning again, make sure that you now take over paying your property tax (and insurance) if they were previously paid through bank escrow. The bank should refund all escrow balances to you. I’ve seen innumerable cases where a property owner pays off his or her mortgage, and then loses or nearly loses the property to tax foreclosure because the owner stopped paying taxes. One major example is the 2006 case Jones v. Flowers, where in which the U.S. Supreme Court saved a property owner’s house because the foreclosing official failed to take further efforts to notify the owner after certified mailings were returned unclaimed.

Congratulations also. That must be a record time for paying off a mortgage.

Since we have relatively little owed on our house, we pay our taxes and insurance directly. On trick we have found is that sometimes it makes sense to accelerate the tax payment before the end of the year to get the deduction on that year’s income tax. Since my wife is a writer, that part of our income fluctuates more than mine, though we’ve also done this when we sold stock, back when that would actually give you a profit.

vetbridge - You’re welcome to start paying off my mortgage, just so you don’t feel at a loss about what to do with the extra cash.

StG