mortgage bank won't take my money

[tryan]

... Walk into a branch office and pay with CASH ... should get some funny looks.

 

[Westernskies]

I went thru the same hassle with C21 Mortgage. I tried to pay off my mortgage via electonic transfer pay-by-phone, but they insisted that I needed to formally request a payoff statement that they would MAIL me, then pay with a certified check, send the final payment via FEDEX by a certain date, etc. They did everything possible to make it impossible to send a check to pay off the account. I did not need an immediate lien release, nor did I care if they sent me the lien release a month later. I wasn't selling or refinancing. Didn't matter. I talked to three supervisors and wasted two hours of my life with those people.

Anyway, I happened to have a a HELOC with a $100 balance as well as the mortgage- so I just sent full payment with the monthly coupon for the mortgage with a personal check, (added about ten bucks to the amount the electronic customer service voice told me I would owe for payoff a week after I sent the check...)which then put the HELOC in first position. That threw them for a loop. Then I paid off the $100 HELOC a month later when I received my usual statement.

Never requested a payoff , never asked to close the account, but they did it for me, since they no longer had any financial interest in the house. I got a refund of about six bucks three months later, with the lien release... Along with a letter of congratulations for paying off a 30 year mortgage in six years. (It should have been a letter of congratulations for figuring out HOW to pay off the mortage in spite of their system... And a stupid Customer Service Questionnaire , which I gleefully completed and returned via certified mail )

 

[SecondCor521]

Maybe so (though from the paperwork I thought they had taken that into account). Truthfully, it didn't really bother me since I had the money. Actually I enjoyed being paid by the mortgage company that month instead of the reverse.

When I "paid off" (actually refinanced) my mortgage back in February, USAA quoted a payoff figure that included interest through the end of the month. I was told that was standard practice because they couldn't determine a priori on which exact date the payoff would be received and applied to my account. So the new mortgage company sent them a check for the "too large" payoff amount, created a couple hundred dollar credit, and USAA cut me a check a couple of weeks later.

2Cor521

 

[Sarah in SC]

Local bank did not require certified funds, but I did call for the payoff.
They sent the release of lien within a month.

 

[free4now]

I say pay in pennies.

 

[Rustward]

My recollection is that I entered a request for payoff amount on the mortgage company's web site and they let me download a document to send with payment. Wouldn't accept a personal check or bank draft, so I had my credit union wire them the funds and I faxed them the completed document.

They accepted our personal checks for 15 years, but not for the final payment.

 

[bssc]

We had Chase, asked for a payoff statement and paid it off completely as additional principal on our mortage payment. We called, the CSR confirmed that there was no balance and started the process to take the lien off the house. No certified check needed.

 

[W2R]

I don't recall the certified check when I paid off my Chase mortgage, but maybe they required one. I just don't remember.

Coincidently, today I happened to come across some paperwork including a xeroxed copy of the certified check that I sent. So yes, I sent one too. The paperwork said they needed a wire transfer, a cashier's check, or an "Official Bank Check". I am not exactly sure of what they meant by the latter but anyway I chose to send a cashier's check and I have proof.

 

[bradh]

I stumbled across the same issue. I paid most of my mortgage off last month, thinking I would clean up the rest this month. I called them & they said I had to request a payoff, so I did that & the form said I needed to pay it w/ a cashiers check or wire. I didn't want to do either so I thought I would just make an online payment the way I have been doing but it wouldn't let me! My principle was below the minimum payment so it wouldn't let me pay. Next step was to call them (flagstar), the rep asked how much I owed & she said no problem, a regular check was fine for a small amount.
I think bssc has the ticket to sidestep the problem. Just pay it off before your principle is below the regular payment amount. They can't ask for a cashiers check for $0. If you pay a little too much you'll just get it back w/ the escrow.

 

[rescueme]

... Walk into a branch office and pay with CASH ... should get some funny looks.

We did (in a way). 30 year fixed; paid it off in 5.5 years. The last of it (around $12k) was done at a branch office, where we held an account. They simply looked at their system to see the payoff, and deducted the amount from our (interest bearing) checking.

This was back in the days (early 90's) of our local community bank actually holding the note rather than reselling it, so I doubt if anybody would do this same thing today...

 

[Keim]

We did (in a way). 30 year fixed; paid it off in 5.5 years. The last of it (around $12k) was done at a branch office, where we held an account. They simply looked at their system to see the payoff, and deducted the amount from our (interest bearing) checking.

This was back in the days (early 90's) of our local community bank actually holding the note rather than reselling it, so I doubt if anybody would do this same thing today...

Not so. I just paid the last $50k on mine off last month by doing this. It did get the teller a little excited.

 

[chemist]

I wired my payoff to Wells Fargo. I paid maybe $15 to my CU for the wire fee, but I would have spent just as much plus another day's interest on a FedEx envelope. Wired money is good funds.

 

[clifp]

I've always wired my mortgage payoffs never had a problem. Schwab gives me free wiring so I take advantage of it.

 

[MissMolly]

Having worked in this industry for 30 years, perhaps I can shed some light on why it is common practice to require certified funds at payoff. We also have that policy at my former place of employment (just retired 10-01-10). Every time that we let someone talk us into accepting a personal check, it never failed that they would place a "stop payment" order. Please understand that once a payoff is accepted and processed, a lot of work goes on behind the scenes. We are (in my state) required by law to process a lien release within 30 days of receipt of funds. Not 30 days after we think it's cleared, but 30 days after we receive the money. Not all checks bounce in 30 days - some take longer. So there were times we had already processed a release and then the check was returned. It is very difficult to put a lien back in place once it's released and frequently there would be other liens behind ours so then we had a lot of legal work to go through to get our first position back. Additionally, on some loans, such as Fannie Mae loans, we were required to remit the payoff funds to Fannie within 48 hours. Even if the check bounced, they would not return the money to us. A payoff reversal created lots of problems.

So although you may think that your mortgage company is just trying to be a PITA, they have good reasons. All places of business have rules and regulations. We may not always know the reasoning behind the rules, but I know of no business that makes rules simply to inconvenience their customers. There is usually a sound business practice to support the rule.

 

[stevenst]

Molly: That was a great explanation, and totally spun my opinion of the practice by 180 degrees! Thanks.

When I paid off my mortgage, it was just a transfer from my credit union checking account to the credit union mortgage account, so no checks were needed. It was kind of nice, though. When I told the very-new teller I wanted to pay off my mortgage, she did a small double-take, and said 'Cool! I've never done one of those. Let me go find out how.' Made my day

 

[GregLee]

Can someone explain this "lien release" stuff? Is there ordinarily a lien in connection with a mortgage? (I'm just wondering if I should have gone through some legal maneuver back in 2004 when I finished paying off my mortgage to a private lender.)

 

[MissMolly]

Assuming your mortgage was filed of record in the courthouse, a lien release would be required in order to pass clear title at the time sale. Ordinarily, this process is automatic to the lender/servicer and no action is needed on the part of the borrower (it is also a matter of law/state statute). You can always go to your courthouse and check to see if the lien was properly released.

 

[GregLee]

Assuming your mortgage was filed of record in the courthouse, a lien release would be required in order to pass clear title at the time sale. Ordinarily, this process is automatic to the lender/servicer and no action is needed on the part of the borrower ...

Thanks. Since the holder of my mortgage was just a person, the previous owner of my house, I'm not sure he would know what special to do, if anything, when I finished paying off my mortgage back in 2004. Following your suggestion, I located where to find whether "a lien is attached to an exisitng, recorded deed", which turns out to be the Hawaii State Bureau of Conveyances, and searched their documents. I found the mortgage and the deed, but that's all -- no reference to any liens. So, I guess it's okay. But I can't say I understand the relationship between mortgages and liens.

 

[chemist]

But I can't say I understand the relationship between mortgages and liens.

A mortgage NOTE is the loan document that spell out the interest rate and other terms (like a bond).

A mortgage LIEN is something filed at the courthouse to say that you owe someone money, and the loan is secured by the real estate, and so you can not sell the property until the LIEN is removed.

Naturally the LIENHOLDER will not release the LIEN until the NOTE (loan) is satisfied.

 

[nwsteve]

Let one of our esteem lawyer members weigh-in, but it has always been my understanding you want a formal release from the mortgage holder. It can be as simple as writing across the original mortgage "paid-in-full" and dated which you will then want to record. This "release" removes any possible cloud on your title and will make any future sale much easier.
Nwsteve

 

[GregLee]

... It can be as simple as writing across the original mortgage "paid-in-full" ...

After he got my last mortgage payment, the previous owner sent me a bouquet of protea with a note saying "Thanks." I no longer have the protea or note.

I found there is a fee of $25 for recording a "Satisfaction of Mortgage". I wonder if that is an acknowledgement that the mortgage was paid.

Google yielded this: "A Satisfaction of Mortgage is a document signed by a mortgagee acknowledging that a mortgage has been fully paid and that the mortgage is no longer a lien on the property. In order to clear the title to the real property owned by the mortgagor, the Satisfaction of Mortgage document must be recorded with the County Recorder or Recorder of Deeds."

So I guess the mortgage is a lien on the property, and I had better arrange for a Satisfaction of Mortgage to be signed and recorded.

 

[MissMolly]

Yes, a mortgage is a lien. It secures your property for repayment of the note. If you have paid the loan in full you will definitely need to secure a lien release, satisfaction of mortgage, mortgage release, deed of release (it is known by any number of different names depending on what state you live in). Only the holder of the mortgage (the person/entity you borrowed the money from) can release the lien. You will need to contact that person/entity and request that they file the release assuming they filed the mortgage to begin with (if it was never filed, there is nothing to release). I would take care of this sooner rather than later.

 

[GregLee]

... contact that person/entity and request that they file the release ...

I'll do that. Thanks for the advice.

 

[braumeister]

just retired 10-01-10.

If no one has said it yet, CONGRATULATIONS !!!

 

[pb4uski]

I would sent them a check for the payoff less 2 cents. Then perhaps if I was in a fiesty nood I would send then a check for 1 cent the following month.

Then sit back, eventually they will come to you and beg you to payoff the loan.