Sometimes, sellers in real estate transactions ask us if they have to pay their mortgage off prior to the sale of the property. The answer is no. The seller’s mortgage will be paid off at the time of closing. At that time, the buyer’s attorney will deduct the amount necessary from the seller’s proceeds in order to pay off the seller’s mortgage. Prior to the closing, the buyer or the seller’s attorney will order a payoff from the seller’s mortgage company. That amount is then sent to the mortgage company and the mortgage company will issue a Discharge of Mortgage shortly thereafter. That document gets sent to the County Clerk’s Office where it is recorded and returned to the original seller. Shortly after that time, the buyer’s title insurance company will review the title to the property and make sure that the mortgage was actually discharged and thereafter issue its Title Insurance Policy. The Title Insurance Policy is proof that the mortgage has been paid off.
If you require experienced legal assistance for any of your real estate, bankruptcy or family law matters, contact the Mark Scollar Law Office today to schedule a consultation.