What document is issued by the lender when a borrower pays off their mortgage loan in full?

What document is issued by the lender when a borrower pays off their mortgage loan in full?

• A. Satisfaction of Mortgage
• B. Mortgage Release
• C. Loan Closure Document
• D. Escrow Closing Statement

Answer: (A)

When a borrower pays off their mortgage loan in full, the lender issues a Satisfaction of Mortgage. This document serves as official proof that the borrower has fulfilled all obligations of the mortgage agreement, including paying off the remaining balance. It is important for the borrower because it effectively clears the lien that the mortgage placed on the property. By recording this satisfaction with the appropriate government authority, it informs the public that the mortgage has been satisfied, allowing the borrower to hold clear title to the property without any claims from the lender. This document is critical in the mortgage process because it helps ensure that future owners, potential buyers, or other lenders are aware that the property is free of that particular mortgage lien. Having a Satisfaction of Mortgage is also vital for the borrower's financial records and is often a requirement for selling the property or obtaining additional financing in the future. Other options, while they may be related to mortgage transactions, do not serve this specific purpose of documenting the payoff of a mortgage loan.

When a borrower pays off their mortgage loan in full, the lender issues a Satisfaction of Mortgage. This document serves as official proof that the borrower has fulfilled all obligations of the mortgage agreement, including paying off the remaining balance. It is important for the borrower because it effectively clears the lien that the mortgage placed on the property. By recording this satisfaction with the appropriate government authority, it informs the public that the mortgage has been satisfied, allowing the borrower to hold clear title to the property without any claims from the lender.

This document is critical in the mortgage process because it helps ensure that future owners, potential buyers, or other lenders are aware that the property is free of that particular mortgage lien. Having a Satisfaction of Mortgage is also vital for the borrower's financial records and is often a requirement for selling the property or obtaining additional financing in the future. Other options, while they may be related to mortgage transactions, do not serve this specific purpose of documenting the payoff of a mortgage loan.