Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
Mortgage payoff logistics
Old 10-25-2015, 07:04 PM   #1
Dryer sheet aficionado
 
Join Date: May 2015
Posts: 45
Mortgage payoff logistics

We're paying off the mortgage. The funds should be available on Tuesday and we just want to get it done. We looked at the payoff statement available on our servicer's website and realized we'd be paying $96.50 in fees

Balance remaining $ 61,769.13
Total amount due $ 61,841.09

Recording Fee $ 10.00
Lien Release Fee $ 21.50
Demand Fee $ 15.00
Mortgage holder's wire Fee $ 25.00
My banks wire Fee $ 25.00

Ok, so the first three are, annoyingly, built into the balance. But those last two are avoidable. The servicer's website has a silly disclaimer about accumulated interest and not paying the total balance online.

What would happen if I just paid say, $61,750 as an ACH from their online interface? That should leave me with a balance of ~$19.13 that I could simply make as my last payment right? Avoiding $50 in wire transfer ridiculousness.

Anyone else gone through the logistics of making that last payment?
__________________

__________________
orangehairfella is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 10-25-2015, 07:15 PM   #2
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
pb4uski's Avatar
 
Join Date: Nov 2010
Location: Vermont & Sarasota, FL
Posts: 16,410
Just call them and they should be able to give you the payoff as of a certain date and let you know if you can ACH or just mail them a check and avoid the $50 in wiring fees. Even if you end up overpaying them a little, they will likely send you a refund for any overpayment once they have sorted it all out.
__________________

__________________
If something cannot endure laughter.... it cannot endure.
Patience is the art of concealing your impatience.
Slow and steady wins the race.
pb4uski is offline   Reply With Quote
Old 10-25-2015, 07:25 PM   #3
Thinks s/he gets paid by the post
Senator's Avatar
 
Join Date: Feb 2014
Location: Eagan, MN
Posts: 3,045
Fidelity offers a wire service for $10. You can transfer the funds to fidelity via ACH, and wire it from there.

You will likely pay more in interest while waiting for the ACH to clear than the original wire fee.

Maybe the bank will give you a break? A one-time free-be? Match a price?

Can you just mail a personal (or certified) check to the bank for the payoff amount?

Add up the daily per diem and you will likely find that the wire transfer saves money.
__________________
FIRE no later than 7/5/2016 at 56 (done), securing '16 401K match (done), getting '15 401K match (done), LTI Bonus (done), Perf bonus (done), maxing out 401K (done), picking up 1,000 hours to get another year of pension (done), July 1st benefits (vacation day, healthcare) (done), July 4th holiday. 0 days left. (done) OFFICIALLY RETIRED 7/5/2016!!
Senator is offline   Reply With Quote
Old 10-25-2015, 08:47 PM   #4
Thinks s/he gets paid by the post
 
Join Date: Mar 2010
Location: Kerrville,Tx
Posts: 2,710
Quote:
Originally Posted by Senator View Post
Fidelity offers a wire service for $10. You can transfer the funds to fidelity via ACH, and wire it from there.

You will likely pay more in interest while waiting for the ACH to clear than the original wire fee.

Maybe the bank will give you a break? A one-time free-be? Match a price?

Can you just mail a personal (or certified) check to the bank for the payoff amount?

Add up the daily per diem and you will likely find that the wire transfer saves money.
A cashiers check may be better than a personal check. (it will likley save a day or two). Then send the letter either certified or via UPS/FedEx.
__________________
meierlde is online now   Reply With Quote
Old 10-25-2015, 11:01 PM   #5
Dryer sheet aficionado
 
Join Date: May 2015
Posts: 45
Quote:
Originally Posted by Senator View Post
Fidelity offers a wire service for $10. You can transfer the funds to fidelity via ACH, and wire it from there.

You will likely pay more in interest while waiting for the ACH to clear than the original wire fee.

Maybe the bank will give you a break? A one-time free-be? Match a price?

Can you just mail a personal (or certified) check to the bank for the payoff amount?

Add up the daily per diem and you will likely find that the wire transfer saves money.
Yeah, I'd actually pay ~$20 in interest waiting for the ACH to clear.

I also just noticed that while PHH is the servicer on the loan, Wells Fargo actually owns it now. I wonder if I can just go into a Wells Fargo branch with a cashier's check and handle this?
__________________
orangehairfella is offline   Reply With Quote
Old 10-25-2015, 11:07 PM   #6
Thinks s/he gets paid by the post
MooreBonds's Avatar
 
Join Date: Aug 2004
Location: St. Louis
Posts: 2,091
Quote:
Originally Posted by orangehairfella View Post
I also just noticed that while PHH is the servicer on the loan, Wells Fargo actually owns it now. I wonder if I can just go into a Wells Fargo branch with a cashier's check and handle this?
Same reason you can't just go into any other business with multiple subsidiaries and get service - they have a dedicated processing center to handle payments for their mortgage division. Their mortgage division isn't their retail banking division. Their branch would likely have to mail it to the processing center anyway.

Plus, would you really want to trust some random bank teller to accurately process your $60,000 check and have it credited properly and correctly (which I doubt they even could...but assuming they could....)
__________________
Dryer sheets Schmyer sheets
MooreBonds is offline   Reply With Quote
Old 10-26-2015, 06:49 AM   #7
Full time employment: Posting here.
 
Join Date: Mar 2011
Posts: 534
I did something just like you propose - I made a large, six figure payment on my mortgage using a personal check and a payment slip from the loan book. Then after it cleared I called the bank to get the payoff amount which was then tiny. They were chill about it and accepted a personal check for the payoff.
__________________
jon-nyc is offline   Reply With Quote
Old 10-26-2015, 07:33 AM   #8
Moderator
rodi's Avatar
 
Join Date: Apr 2012
Location: San Diego
Posts: 8,804
I think Schwab waived the wire transfer fee for me when I paid off my mortgage just before retiring.

Unfortunately for me - I was paying it off right as the mortgage was being sold from the original lender to another lender and both parties denied receiving the money or record of the transfer. Fortunately, wire transfers, paper receipts of the transfer, etc were able to prove the payoff... but it took about a month to resolve.
__________________
Retired June 2014. No longer an enginerd - now I'm just a nerd.
micro pensions 7%, rental income 18%
rodi is offline   Reply With Quote
Old 10-26-2015, 08:09 AM   #9
Recycles dryer sheets
 
Join Date: Oct 2010
Posts: 228
Quote:
Originally Posted by orangehairfella View Post
I also just noticed that while PHH is the servicer on the loan, Wells Fargo actually owns it now. I wonder if I can just go into a Wells Fargo branch with a cashier's check and handle this?
This is basically how I paid off my mortgage. It was held by Wells Fargo. I went to my local branch and told the teller what I wanted to do. They assigned a personal banker to me who walked me through the process, setting up the money transfer.
__________________
jimbee is offline   Reply With Quote
Old 10-26-2015, 09:40 AM   #10
Dryer sheet aficionado
 
Join Date: May 2015
Posts: 45
Quote:
Originally Posted by jimbee View Post
This is basically how I paid off my mortgage. It was held by Wells Fargo. I went to my local branch and told the teller what I wanted to do. They assigned a personal banker to me who walked me through the process, setting up the money transfer.
Interesting, I saw a bogleheads thread with several others that had done the same thing, with varying success. Was Wells Fargo just the holder of the note, or were they also the servicer? Maybe I'll ride my bike over to the branch today and talk to a banker.
__________________
orangehairfella is offline   Reply With Quote
Old 10-26-2015, 10:06 AM   #11
Thinks s/he gets paid by the post
Cobra9777's Avatar
 
Join Date: Jul 2012
Location: Texas
Posts: 1,132
I paid off our mortgage a couple years ago. The mortgage company website allowed you to create a payoff statement as of a certain date. I chose about 3 or 4 days in the future and wrote down the specific amount. They had no fee for an incoming wire, just a small recording fee. I then called my bank and arranged a wire transfer for the payoff amount to occur on that specific date. Their charge was $20 for the outgoing domestic wire transfer. Everything went like clockwork.

The bank told me I could also write a check or do an ACH to avoid the wire fee. But the only way they could guarantee the timing was with a wire transfer. They told me the ACH takes 2-4 days. So I figured I could calculate the payoff 5 days out and likely receive a refund for a day or two of interest. I decided to keep it clean and spend $20 on the wire. If it had been $50 like OP, I might have done the ACH.
__________________
Retired at 52 in July 2013. On to better things...
AA: 55% stock, 15% real estate, 27% bonds, 3% cash
WR: 2.0% SI: 2 pensions, some rental income, SS later
Cobra9777 is offline   Reply With Quote
Old 10-26-2015, 10:26 AM   #12
Recycles dryer sheets
 
Join Date: Oct 2010
Posts: 228
Quote:
Originally Posted by orangehairfella View Post
Interesting, I saw a bogleheads thread with several others that had done the same thing, with varying success. Was Wells Fargo just the holder of the note, or were they also the servicer? Maybe I'll ride my bike over to the branch today and talk to a banker.
Wells Fargo was the mortgage servicer. I did initiate a mortgage payoff process on Wells Fargo's website, but chickened out.
I've seen too many poorly done websites to trust it, so I did not finish using the website and visited the local branch office. There weren't any additional complications that I can remember. I also have a Wells Fargo checking account, that may have simplified the process.
__________________
jimbee is offline   Reply With Quote
Old 10-27-2015, 12:48 PM   #13
Confused about dryer sheets
 
Join Date: Oct 2015
Location: USA
Posts: 8
I just joined the forum today, but I have been lurking for many years. I never really felt I had much to contribute, but I had to weigh in to this topic, because I think I have some info that can save forum members who are paying off their mortgage a few bucks.


I paid off my mortgage a few years ago, it was being serviced by Wells Fargo. I happened to know someone at the company that knew how things were calculated, and she explained it to me. I was shocked at what she told me, but I kept track of all my payments and calculated the interest as per how she told me it would be and it came out exactly right down to the penny. I am pretty confident that the way interest is calculated was not unique to WF, I am guess it is probably standard throughout the industry and dictated by language in the mortgage note.


When the bank calculates interest, they take your principle balance, on the first day of the month, and multiply that by the annual interest rate on your mortgage /12. Then they add that amount of interest to your loan.


The key here is that they use the outstanding balance on the first day of the month. This means if you make an extra payment towards principle on the 2nd day of the month, or the 30th of the month it doesn't matter the amount of interest you pay will be the same. So the moral of this is if you want to make an extra payment towards principle you should make it at the end of the month.


Now when it comes time to pay off the mortgage they do things a little differently. At payoff day, they take your current balance and pro-rate the interest depending on what day of the month you are paying it off on. Notice I said they take the current balance, they do not look at what the balance was at the beginning of the month. In other words, if you have a $10,000 balance at the beginning of the month, pay $9,900 on the 5th of the month, and then pay off the mortgage on the 10th, they would figure your last months interest as 10 days interest on $100. It may seem crazy, but this is how they did it for me.


As another really cool feature if your mortgage is serviced by Wells Fargo, like mine was. (If it is serviced with another bank I would see if they have this ability too.) The banks computers is hooked into the Mortgage departments computers, so you can ask the teller for your current mortgage balance. You can also make your currently monthly mortgage payment, and extra mortgage principle payments any day you want. You can even pay with cash if you want to. No need to talk to a banker, just go right to the teller.


I don't remember for sure on the very last payment, but I think the teller gave me a payoff quote. If she didn't then I probably got the pay-off quote on line, and then took that in to the bank and paid the teller. I do remember the teller congratulating me on paying off my mortgage.
__________________
OMY-Syndrome is offline   Reply With Quote
Old 10-27-2015, 01:09 PM   #14
Thinks s/he gets paid by the post
Big_Hitter's Avatar
 
Join Date: May 2013
Location: In the fairway
Posts: 4,094
If your balance is high enough your bank should waive the wire fee - When I pay off mortgages I just pay what they tell me cause I'm a lemming...
__________________
Swing hard, look up
Big_Hitter is offline   Reply With Quote
Old 10-27-2015, 01:54 PM   #15
Recycles dryer sheets
Ticker's Avatar
 
Join Date: Nov 2013
Location: waldheim
Posts: 126
congrats on the payoff!
I remember doing mine, and how relieved I felt once the
transaction was completed. There's no feeling quite like owning your house
outright.
Hope you get the same rush as I did!

My sister in law, a mortgage specialist, advised against holding a mortgage burning ceremony-she preferred that I keep all paperwork associated with the mortgage.


__________________
Prepare today for the demands of tomorrow. Plan your move.
Ticker is offline   Reply With Quote
Old 10-27-2015, 02:05 PM   #16
Full time employment: Posting here.
 
Join Date: Jan 2011
Location: Just North of Boston
Posts: 517
Quote:
Originally Posted by Big_Hitter View Post
If your balance is high enough your bank should waive the wire fee - When I pay off mortgages I just pay what they tell me cause I'm a lemming...
reminds me of what I did when I bought my house... I had to get a certified check to bring to my closing of about $300k... Went to my bank and they told me there would be a $20 charge for the check... So, I told them, no thanks, I will just pick up the cash tomorrow. They brought in a supervisor who immediately said "Let me give you a free check this time"
__________________
ChiliPepr is offline   Reply With Quote
Old 10-27-2015, 04:23 PM   #17
Thinks s/he gets paid by the post
Dash man's Avatar
 
Join Date: Mar 2013
Location: Limerick
Posts: 1,668
I paid off my mortgage 5 years ago by wiring the funds. I was so happy to be completely debt free I didn't care about the $20 wire fee. Chase Mortgage didn't charge me to record the mortgage satisfaction document and sent a letter of congratulations. I was able to verify online the document was recorded.


Sent from my iPhone using Early Retirement Forum
__________________
Dash man is offline   Reply With Quote
Old 10-27-2015, 04:46 PM   #18
gone traveling
 
Join Date: Sep 2013
Posts: 1,248
Quote:
Originally Posted by jon-nyc View Post
I did something just like you propose - I made a large, six figure payment on my mortgage using a personal check and a payment slip from the loan book. Then after it cleared I called the bank to get the payoff amount which was then tiny. They were chill about it and accepted a personal check for the payoff.
Same thing with me. It was just an ordinary check send in ordinary envelope with standard postage.

I slightly overpaid and they mailed me check for difference back.
__________________
eta2020 is offline   Reply With Quote
Old 10-27-2015, 06:28 PM   #19
Dryer sheet aficionado
 
Join Date: May 2015
Posts: 45
I ended up just wiring the money like a sucker. When it came down to it I didn't want to mail a check that big, and there were some bogleheads horror stories about servicers refusing huge ACH payments...but sitting on them for a week or more before rejecting them. Between the possibility of accumulating interest and the mental anguish that the delay would cause me, the wire felt worth it.

But now its done and we're once again debt free. Took 3 years, 11 months.
__________________
orangehairfella is offline   Reply With Quote
Old 10-27-2015, 06:46 PM   #20
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Jul 2006
Posts: 11,017
That's what I would have done. Congratulations!
__________________

__________________
Meadbh is offline   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
What are the logistics of co-signing a loan? Khan FIRE and Money 13 01-10-2012 02:20 PM
Hats Off to logistics professionals Brat Other topics 8 01-14-2010 07:31 PM
HSA (logistics) lucija Health and Early Retirement 10 12-04-2009 09:23 PM
Logistics of paying off balloon mortgage, then selling house 1-2 months later RunningBum FIRE and Money 9 05-29-2008 12:04 AM
Another payoff the mortgage outlook dm FIRE and Money 12 10-13-2004 01:27 PM

 

 
All times are GMT -6. The time now is 06:03 PM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.