{"id":1997,"date":"2022-01-31T10:00:00","date_gmt":"2022-01-31T15:00:00","guid":{"rendered":"https:\/\/www.deeds.com\/articles\/?p=1997"},"modified":"2024-04-25T23:19:21","modified_gmt":"2024-04-26T03:19:21","slug":"the-deed-of-reconveyance","status":"publish","type":"post","link":"https:\/\/www.deeds.com\/articles\/the-deed-of-reconveyance\/","title":{"rendered":"The Deed of Reconveyance"},"content":{"rendered":"\n
\"A<\/figure><\/div>\n\n\n\n

Exiting a Mortgage in a \u201cDeed of Trust State\u201d<\/em><\/strong><\/p>\n\n\n\n

If your mortgage exists in the form of a deed of trust<\/em><\/a>,<\/em> what happens at final payoff time? You\u2019ll receive a deed of reconveyance<\/em>, signed by the lender and notarized. Alternatively called a mortgage satisfaction<\/em> or a full reconveyance form<\/em> (depending on your state\u2019s legal custom), it\u2019s your official proof of title transfer from the lender.<\/p>\n\n\n\n

States that use the deed of trust use this method to confirm that your loan has been paid in full. This occurs when you are selling the home, or in a refinance situation, when you get a new loan in place of the old.<\/p>\n\n\n\n\n\n\n\n

A Reconveyance: The Nuts and Bolts  <\/strong><\/h2>\n\n\n\n

Once you\u2019ve repaid your loan in full \u2014 either because you\u2019re done with the debt or you\u2019re refinancing with another loan \u2014 your lender will have the deed of reconveyance created by the title company. Lenders typically have the deed of reconveyance done within 30 or 60 days after payoff, following the state\u2019s allowed window of time. Lenders must meet the deadline or pay penalties and costs. <\/p>\n\n\n\n

In some states, the lender sends the document to the homeowner, who then has the deed of reconveyance notarized and filed with the recorder of deeds in the county where the property is located. In this case the owner receives a copy of the original trust deed, the deed of reconveyance, and a new title.<\/p>\n\n\n\n

If you have received the deed of reconveyance to file, check it for any mistakes. An accurate deed of reconveyance is a key component of proof of payoff and ownership. Everything must be done according to the rules, so there\u2019s no trouble later on when you transfer the title to a new owner. If the deed of reconveyance isn\u2019t properly recorded, the house title isn\u2019t clear.<\/p>\n\n\n\n

\u261b<\/em> Found a typo in a deed? Is there a misspelling of a name or a <\/em><\/strong>mistake in the property’s legal description<\/em><\/a>? Don\u2019t panic. The fix could be a simple <\/em><\/strong>correction deed<\/em><\/a>.<\/em><\/strong><\/p>\n\n\n\n

As a firm rule, whenever a new deed is made, the homeowner should check every line for accuracy. Be sure that the new deed precisely matches the earlier one.<\/p>\n\n\n\n

Reason for the Reconveyance Deed: Refinancing or Selling<\/strong><\/h2>\n\n\n\n
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Interest rates are still at historic lows. Many owners are thinking now is the right time to refinance for the first or second time. If you are one of these owners, you\u2019ll need to make a final payoff on your current loan. This is when the substitution of trustee<\/em> is documented and reconveyance is given to a new lender.<\/p>\n\n\n\n

Before you can refinance, the title company will ask you to order a payoff statement from the earlier lender. If you are selling the house before the whole debt is paid, then, in effect, the buyer is paying off the remaining debt. Both situations require a reconveyance.<\/p>\n\n\n\n

If you have your documents ready, you\u2019re already on your way to a smooth refinancing or selling experience.<\/p>\n\n\n\n

Here are the key documents of homeownership:<\/p>\n\n\n\n