From: "Jeff Strickland" 
Newsgroups: alt.org.natl-assn-mortgage-brokers
Subject: Re: Paid off mortgage.
Date: Fri, 29 Dec 2006 12:35:52 -0800
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I'm California, your experience may vary, but the jist should be the same 
...

The mortgage is secured by the property -- as we already discussed. The 
mechanism to create the security is the Trust Deed, or the Grant Deed. 
(There is a subtle distinction between the two, and I am not sure which is 
which -- from this point I'll simply use the term Deed to mean one or the 
other.) The Deed currently lists the trustee (bank or lender) as the legal 
owner. The concept here is much the same as the title on an automobile. The 
auto itself is security for the loan, and the bank is noted as the lein 
holder until the note is paid. Upon repayment of the note, the banks signs 
off as lein holder and sends you the title. You take the title to the DMV to 
get a new one that hasn't got the bank's name on it. (You don't need to do 
this because the lein holder has signed off, which shows your ownership is 
fully vested.)

In any case, your home is held in much the same manner. If you have the lein 
release, then the next call would be to the county recorder to be sure they 
have the same information, and they will know what you may need to get clear 
title if the lein release does not automatically give it to you.

The main reason you want to be sure the bank is not listed on title anymore 
is that if you want to sell or refinance, you do not want the hassle of 
getting the bank to sign off on a deal they are no part of anymore.

ON ANOTHER RELATED SUBJECT
Are you aware of a Home Equity Line of Credit that you can take out that is 
in a 1st position (1st Trust Deed in my state) that will allow you to 
leverage the equity in your home at some point in the future without having 
to take out a new loan?

What happens is, you take out a loan that exposes your equity to you, but 
you do not necessarily have to use it -- you can have a zero balance on an 
equity line of credit. What happens is, you are driving in the country one 
day with your significant other and see a property that interests you. You 
buy the property with a check tied to the HELOC account attached to the home 
you have already paid off. You do not have to sit in escrow waiting to be 
approved for a new loan because you have the ready cash in hand.

Payments to this HELOC are done via deposits of your pay, or whatever source 
you choose. Your paycheck buys down the balance from the moment it is 
deposited, which effectively causes your paycheck to earn interest at 
whatever your then-current mortgage interest is. As you go through the month 
and pay bills -- utility and so forth -- you use the equity line checks to 
do so. What happens here is, you transfer your effective income tax rate to 
the day to day living expenses that you assign to the mortgage. Mortgage 
interest is a deduction on taxes, utility bills and car payments are not. 
So, if you pay the bills with checks that generate a small amount of 
mortgage interest, then you get a tax deduction for the daily bills. See? 
(Your tax guy can help you figure out if the strategy is sound ...)

But, the HELOC 1st allows you to shift daily living expenses to mortgage 
expense, and it gives you instant access to the huge equity you have in your 
house. (Perhaps your income is such that you do not need this kind of thing, 
but since you managed to pay the house off then you have the 
money-management profile that leads me to think you have high FICO scores 
and can qualify for a product that unlocks your equity today so you can use 
tomorrow in an instant.)

PS
I used to be a mortgage loan officer, which is how I know of the product. I 
am no longer a loan officer so I can't actually hook you up with the 
product. I get nothing to tell you about this stuff ...










"Boomer"  wrote in message 
news:X71lh.16184$_X.10678@bigfe9...
> First I thnank you for your detailed reply, Jeff. I was thinking along the 
> same line. I paid the loan off about six months ago; after calling and 
> getting a run around from department to department, today I received a 
> recorded copy of satisfaction of mortgage. When I called the lien release 
> department, there answer was that this is all I am going to get. I do not 
> need anything else. I am not sure who to contact and how get my hands on 
> the deed.
>
> Thanks,
>
> Boomer
>
> "Jeff Strickland"  wrote in message 
> news:eqidnWY1xKsm9wnYnZ2dnUVZ_qK3nZ2d@ez2.net...
>> You should be looking for a reconveyance of the Trust Deed or Grant Deed. 
>> (I pretty sure it's the grant deed.)
>>
>> In any case, the trustee holds the deed today. You paid the mortgage off, 
>> and the trustor conveys the property to you with the reconveyance. What 
>> happens is, you use the property as security for the loan. Should you 
>> have defaulted on the loan, the bank (through the trustee) exercises its 
>> ownership rights through the Deed, and in the process evicts you through 
>> foreclosure proceedings. In any case, this scenario never kicked in, and 
>> now that you have paid the loan, the trustee should relinquish its 
>> position in the ownership chain. It does this by reconveying the deed to 
>> you.
>>
>> Call the bank's (lender's) Customer Service department and ask them how 
>> long they take to reconvey the deed. I'd go ahead and wait until after 
>> the New Year.
>>
>>
>>
>>
>> "Boomer"  wrote in message 
>> news:ZyVkh.15725$cB6.4311@bignews7.bellsouth.net...
>>> Hello folks,
>>>
>>> I paid my mortgage off about six months ago. I am expecting some 
>>> documents be returned to me, but I have not received any. What documents 
>>> should I expect to receive from the mortgage company?
>>>
>>> TIA
>>>
>>> Boomer.
>>>
>>
>
>