Once your mortgage is paid off, you'll receive a confirmation from your lender. You're now responsible for paying your homeowners insurance and property taxes. Going forward, it's important to reassess your budget and financial goals.
Key takeaways. While you can discard monthly mortgage statements, it's important to keep all mortgage documents, such as the promissory note, deed of trust and proof of title insurance, for the life of the loan.
Once you pay off your house, your property taxes aren't included in your mortgage anymore, because, voila! You don't have one. Now it's on you to pay property taxes directly to your local government.
You must obtain the property deed through your county.
If you need a copy of your property deed, we advise you to contact the county your mortgage is recorded in or check their website for instructions on how to request one.
For example, if you plan to travel frequently in retirement, you may want to aim for 90% to 100% of your pre-retirement income. On the other hand, if you plan to pay off your mortgage before you retire or downsize your living situation, you may be able to live comfortably on less than 80%.
Paying off your mortgage means that you have 100% equity in your home and no longer have to make monthly loan payments to your lender. Once your loan is paid off, you'll have to pay your home insurance premiums and property taxes out of pocket, instead of through an escrow account.
Congratulations on paying off your mortgage! Your taxes will no longer be paid from your escrow account, so you are responsible for paying them directly to the Hancock County Treasurer's Office. Tax statements are mailed out from the Treasurer's Office once per year and include both the spring and fall payment coupons.
It usually takes four to six weeks to complete the legal processes involved in the transfer of title.
You can throw away old mortgage statements, but proceed with caution, because in some cases you should keep old mortgage papers for a long time. For example: Keeping the promissory note, Closing Disclosure, deed of trust and proof of title insurance for the life of a loan is typically required.
What are the best places to keep real estate deeds? Your bank or building society can take care of your deeds. Although keeping your paper documents in a safe deposit box is a very convenient option, they typically charge you for renting a deposit box.
Once the bank has processed the payoff, they will issue a Discharge of Mortgage. This document needs to be recorded at the Registry to show that the mortgage is no longer in effect. You should ask your lender if they will record the discharge or if they will be mailing it to you.
A deed of reconveyance, also known as a satisfaction of mortgage, is a document that proves you've paid off your mortgage. The deed of reconveyance releases the lien the mortgage lender placed on your property. You'll need this document to prove a clear title when you sell your home.
One of the most significant benefits of paying off your mortgage is the peace of mind that comes with owning your home outright. Without a mortgage, you don't have to worry about monthly payments, which can be especially comforting in retirement or during economic downturns.
There is no specific age to pay off your mortgage, but a common rule of thumb is to be debt-free by your early to mid-60s.
While you're paying the bank, your payment goes to principle, interest, taxes and insurance (PITI). After it's paid off, the loan goes away and you're left with the taxes and insurance. The loan is paid and the bank no longer cares about those - it's no longer their concern.
Once mortgage payoff funds are posted, money held in escrow with your current lender will be returned to you from that lender. The existing escrow account cannot be transferred unless your current lender is the same as your new lender, in which case your payoff will be reduced by your current escrow balance.
Once you've sent the payoff amount, your mortgage lender is responsible for sending you and the county recorder documentation to release the mortgage and lien on your home. You should be sent any funds remaining in escrow.
They are considered ad valorem, which means they are assessed according to the value of your property. Since property values rise over time, so do property taxes. Even after you pay your mortgage, the property tax bills keep coming until you no longer own a home.
Updating your insurance provider and local taxing authority
After paying off your mortgage, it might be a good idea to ensure your homeowner's insurance provider and local taxing authority have been notified of the change in your property's lien status. This responsibility typically falls upon the homeowner.
The 2% rule states that you should aim for a 2% lower interest rate in order to ensure that the savings generated by your new loan will offset the cost refinancing, provided you've lived in your home for two years and plan to stay for at least two more.
The ideal monthly retirement income for a couple differs for everyone. It depends on your personal preferences, past accomplishments, and retirement plans. Some valuable perspective can be found in the 2022 US Census Bureau's median income for couples 65 and over: $76,490 annually or about $6,374 monthly.