Fare-well Wells-Fargo

August 30, 2017 4:58 PM

I'm about to pay off my mortgage a little early (6 months early, $12K). What do I need to know?

One question: The insurance is integrated into the mortgage payment. Do I need to do anything with respect to this?

What else?

posted by falsedmitri to Work & Money (6 answers total)

Don't just pay what the balance is. Contact your mortgage holder and ask for a specific amount due if you were to pay it early. Same as selling your house. They will give you an exact amount due if you pay by XX date. Ask them about the insurance and any tax escrow account balance you may have. Otherwise, there is not much to it.

Congratulations in paying off the mortgage and in saying adios to WFC.
posted by AugustWest at 5:20 PM on August 30, 2017 [9 favorites]

Make sure your town knows to send your property tax bill to you rather than the mortgage company if that had also been part of the escrow or whatever. A coworker was just telling me his story about not doing that.
posted by Kriesa at 5:23 PM on August 30, 2017 [4 favorites]

Best answer: The bank should automatically file a "satisfaction of mortgage" after the loan is paid off for. Ask them about that when you call for the payoff quote and how long you should expect that to take. I think it will take something like six weeks but it depends on your county and the lender.

You insurance company should also get notified that they can remove your lender as the "loss payee" on your insurance. Otherwise, if you had a claim, you might have to go through (or your insurance carrier might) have to verify that the bank no longer has an interest before they pay your claim.

Again WF should do this automatically but even banks that really have their act together still make mistakes that can cause headaches down the line.

Otherwise, your appreciating asset is now un-leveraged and you're on your own planning for and paying the insurance and tax bills. There isn't anything else I can think of that's changed.
posted by VTX at 5:50 PM on August 30, 2017 [1 favorite]

It wouldn't hurt to call both your insurance company and your county tax office a couple months after you get confirmation the loan is paid off. I paid off my mortgage last year and neither one seemed to have been notified by my bank. You'll need to start paying both the insurance and taxes directly, but they need you know to send the bills directly to you.
posted by something something at 6:20 PM on August 30, 2017 [5 favorites]

Take this opportunity to shop around for house insurance - our rates dropped quite a bit once the mortgage was paid off. You'll likely find a much better yearly rate as an owner than you've been getting as a mortgage payer.

And congrats :)
posted by Mary Ellen Carter at 7:52 PM on August 30, 2017 [2 favorites]

Yeah, you want a "payoff letter" stating the full amount that you must pay by [x date] in order to pay off the mortgage.
posted by praemunire at 10:05 PM on August 30, 2017 [2 favorites]