# Final Mortgage Payment



## hope4wealth (Sep 15, 2013)

Looking for some insight/advice.

We are about to make our final mortgage payment in the coming month. Are there some things I should be aware, or action, prior to or just after the payment? Doing some research and some say to work with a lawyer while others think this is all covered by the bank.

Also, anyone have any thoughts on the need for us to get title insurance? Whom we can go to for a quote, etc?

Appreciate any responses.


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## Underworld (Aug 26, 2009)

Awesome - congrats!

Lawyer seems pretty heavy handed. When I finished my student loan, I called ahead of time and they said that they would wrap everything up. They also waived the fractions of dollars in interest difference on the final payment. You might want to run a credit check report a year afterwards to see that it has been removed from your credit report. (6 months after it clears?)


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## Ag Driver (Dec 13, 2012)

Congrats!


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## Plugging Along (Jan 3, 2011)

Congrats. We didn't get a lawyer just our discharge papers.


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## NotMe (Jan 10, 2011)

If you bought title insurance when you bought the house, I'm pretty sure you have title insurance forever , no?

But what you may want to do after you pay it off is to register a home equity line of credit against the house and just keep it at a zero balance.

I *believe* that the whole scam about fraudently transferring ownership of a paid off house is a lot harder to do if a debt is registered against the house, even a debt with a zero balance is still a debt (because it could go up to $30,000 or whatever).


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## betsu63 (Mar 4, 2011)

*Congratulations*

Make sure that the mortgage discharge is done at the Land Registry office (service Ontario in Ontario). Found out mine wasn't when I sold my house. It had been paid off 17 years before and I happened to still had the paperwork luckily. The credit union I had dealt with had gone through a couple amalgamations and we're having problems finding the "proof".


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## Sasquatch (Jan 28, 2012)

It shouldn't be a big deal, depending on I suppose where you live. I just made sure I got all the appropriate discharge paperwork from the bank. 
I also went to the Land registry and gave them copies of the mortgage discharge paperwork while checking that there were no liens against my house.(a contractor had threatened me to put a lien on it but he never did )
Didn't need a lawyer to do that, it just involved a bit of running around. I'll do a lot of running around to save $ 500.- or so bucks


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## lb71 (Apr 3, 2009)

NotMe said:


> But what you may want to do after you pay it off is to register a home equity line of credit against the house and just keep it at a zero balance.
> 
> I *believe* that the whole scam about fraudently transferring ownership of a paid off house is a lot harder to do if a debt is registered against the house, even a debt with a zero balance is still a debt (because it could go up to $30,000 or whatever).


I agree on both counts. I would get the HELOC. It's fast access to a LOC at low rate. It is also my understanding that keeping the home registered is an extra deterrent to title theft.


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## Mortgage u/w (Feb 6, 2014)

If you make your final payment and wish to discharge the loan, the bank will charge you a discharge fee. As already mentioned, try to convert to a HELOC and keep a 0 balance, however, this may incur fees in order to register the lien as such. If you can just pay-off you mortgage and not be obligated to discharge the loan, then go that route.....you're still somewhat protected from fraud and it doesn't cost you anything.

If you already bought title insurance and it covered YOU and not the lender, then it will follow. If not, you can purchase one through your lawyer, FNF or FCT. If you are getting tile insurance, no need to keep a HELOC - title insurance protects you from title fraud.


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## Jungle (Feb 17, 2010)

Mortgage u/w said:


> If you make your final payment and wish to discharge the loan, the bank will charge you a discharge fee. As already mentioned, try to convert to a HELOC and keep a 0 balance, however, this may incur fees in order to register the lien as such. If you can just pay-off you mortgage and not be obligated to discharge the loan, then go that route.....you're still somewhat protected from fraud and it doesn't cost you anything.
> 
> If you already bought title insurance and it covered YOU and not the lender, then it will follow. If not, you can purchase one through your lawyer, FNF or FCT. If you are getting tile insurance, no need to keep a HELOC - title insurance protects you from title fraud.


What happens if you pay your mortgage off but already have a heloc ?

Do you still have to pay discharge fee on the mortgage term?


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## newfoundlander61 (Feb 6, 2011)

You should be sent discharge papers in the mail without asking the bank for them. Not sure how long it takes but thats how ours worked when we paid off the house with CIBC.


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## My Own Advisor (Sep 24, 2012)

Doesn't the bank send you all the discharge paperwork?

There shouldn't be anything for you to do except party.


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## MRT (Apr 8, 2013)

AFAIK, unless something has changed in the last few years, it depends on where you live and if your jurisdiction has migrated to electronic registration of documents, but you should not need to involve a lawyer, regardless.

if the jurisdiction in which your property is found has migrated to e-reg, then the bank will electronically register the discharge and you have to do nothing.

OR

if your area/property is still subject to manual registration, you may be sent an executed (signed) discharge by the bank, which you then need to take to the Land Titles Office for registration. 

IMHO, the best thing to do is call the Servicing department of your lender and confirm their natural discharge process as it applies to your property.


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## gardner (Feb 13, 2014)

Our bank has been sending us letters inviting is to pay around $260 discharge fee for our mortgage that was paid off many months ago. We've been ignoring them for some time. We will likely pay them at some point, but there seems no risk in leaving them hanging. There's a thread on here about our circumstances with mixed ideas how to proceed.

The moral is that there may well be further charges pending, even after the last mortgage payment.


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## MRT (Apr 8, 2013)

no, the moral is to read your documents 

The discharge fee will be recited in your mortgage papers, and in all but the rarest of cases will need to be paid before a discharge is registered.

I suspect lenders might also withhold a letter of release to the borrower's home insurer until the discharge is processed. Given that some insurers provide an additional discount if a property is mortgage-free, you could actually be spiting yourself with this delay. The fee will likely get paid at some point, but I doubt your home insurer will back-date a discount...?


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## Mortgage u/w (Feb 6, 2014)

Jungle said:


> What happens if you pay your mortgage off but already have a heloc ?
> 
> Do you still have to pay discharge fee on the mortgage term?


No. If you make your final payment on a HELOC, the lender should not be charging a discharge fee as long as you do not request a discharge....and they cannot obligate you to do so.


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## MRT (Apr 8, 2013)

I think the question refers to a case where you have a mortgage and a separately registered HELOC, in which case a discharge fee indeed will apply once the mortgage is paid off. 

A combo product (like Scotia's STEP) is registered as a single charge on title, so if the mortgage portion is paid off, and the HELOC remains, there is nothing to discharge.


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## marina628 (Dec 14, 2010)

When we paid off our mortgage last year we decided to keep the lien registered because of the title insurance.So even though we own nothing on the house TD has a lien on it of about $125,000.when/if we ever sell then we will get rid of it.


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## FrugalGuy (Oct 25, 2013)

marina628 said:


> When we paid off our mortgage last year we decided to keep the lien registered because of the title insurance.So even though we own nothing on the house TD has a lien on it of about $125,000.when/if we ever sell then we will get rid of it.


Will you still be able to have lower rate on your home insurance because you are mortgage free?


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## marina628 (Dec 14, 2010)

No clue never asked...I had no idea you would pay less if you had no lien ,we paid cash for our truck about a month ago and I don't see a cash discount on that policy.


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## Jungle (Feb 17, 2010)

MRT said:


> I think the question refers to a case where you have a mortgage and a separately registered HELOC, in which case a discharge fee indeed will apply once the mortgage is paid off.
> 
> A combo product (like Scotia's STEP) is registered as a single charge on title, so if the mortgage portion is paid off, and the HELOC remains, there is nothing to discharge.


Yes this is exactly what we have Scotia step. We have a heloc $0 balance, but 2 mortgage terms. My papers say there is a discharge fee when mortgage fee is paid off, but since there is an open heloc registered against the title, I always wondered why they would still charge a discharge fee on the mortgages.


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## Mortgage u/w (Feb 6, 2014)

Jungle said:


> Yes this is exactly what we have Scotia step. We have a heloc $0 balance, but 2 mortgage terms. My papers say there is a discharge fee when mortgage fee is paid off, but since there is an open heloc registered against the title, I always wondered why they would still charge a discharge fee on the mortgages.


No bank can oblige you to discharge your mortgage whether its a fixed mortgage or a HELOC. They will advise you that there is a fee to discharge your mortgage since they will have to cover the costs to remove the lien, but you are not obligated to discharge it. And the fees will not apply unless you request a discharge.


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## Jungle (Feb 17, 2010)

Great thanks for the clarification, we plan to keep the heloc with no balance owing and mortgage paid off.


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