Woo hoo! First of all, celebrate! Paying off a mortgage in Key West is a huge deal, especially if you managed to do it in less than 30 years. But let’s take a step back and consider all the things you’ll need to do before you pay it off and after. It sounds as easy as sending in a check and throwing a party, but it isn’t quite that simple. Let’s go over some things that will make the payoff process as smooth as possible.
If your mortgage lender calculates a per diem into your payoff, it is especially important for you to call in and have your lender quote a payoff. If you’re mailing in a check, they’ll more than likely quote a 3-day or 10-day payoff, depending on your method of sending. The post-dated quote will cover any per diem interest that will accumulate between the date you send and the date they receive.
Find out the method your lender will accept for payoff. Some lenders will require a cashier’s check, others might require you send it to a different office where payoffs are processed. Get the details from your lender.
Once you’ve actually paid off your mortgage, you should receive a “Satisfaction of Mortgage” statement and a final mortgage note as soon as your payment has posted to your account. This is the legal proof you’ve paid your loan in full, and really the only proof you need. Be generous and give your lender about three weeks before inquiring about it.
After you’ve received that “Satisfaction of Mortgage” statement, you’ll file it with your local register of deeds. Some lenders will file this on your behalf, others won’t or might require a fee. So just be sure to ask.
Your escrow account, opened by your lender to hold the part of your payment dedicated to taxes and insurance, will be closed once your obligation is fulfilled. Now you’ll be responsible for handling these bills yourself. It might be a good idea to open up an account to have the insurance company and tax office draft the funds from. It’s also smart to keep about 10% in excess of your current tax and insurance payments in the account in case of increases, which can happen sometimes without warning.
You’ve paid off your house and now you might even get a check to boot! When your escrow account closes, it’s quite common for there to be a balance left in the account, and that balance should come to you in the form of a check. If you don’t get one in the following weeks after payoff, it is certainly ok to ask about it.
Call your current insurer and let them know you’ve paid off your home. Oftentimes, there could be changes in your coverage. The agent may also be able to recommend a policy that will save you money and be more in line with your current insurance needs.
What do you do with all the extra cash you’ll have on hand once you’ve paid off your mortgage? With mortgage payments being hundreds to thousands of dollars, that can be a nice chunk of change in your pocket each month. Financial planning will need to be a part of your life if it hasn’t been already. Perhaps getting caught up on other debt or saving for retirement are options for you. Speak with your financial planner and take your future into your hands. The end of a mortgage is the beginning of a new life.
Maybe that retirement home in The Keys is on your radar now. Let’s talk about it! Give me, Jimmy Lane, at Key West Real Estate, a call today at 305-766-0585.
Whether you’re a tourist, looking to move permanently to the Keys, or just someone who likes the beauty of nature, the great variety of amenities in the homes in our area is just more reason to want to live in beautiful Key West.
Labels: financial planning, floriday keys, jimmy lane, key west, paid in full, payoff, real estate, satisfaction of mortgage
