Mortgages Analyzed
Mortgages Analyzed
Mortgages Analyzed
 
Reconveyance Deed

What is Reconveyance Deed?

Reconveyance Deed certifies that the lender or trustor has released its lien and conveyed all rights and interest in the real estate to the borrower upon full repayment or discharge of loan. Simply stated, it is a document stating the borrower has fully repaid the loan and the lender is releasing its claim on the title. The deed is issued by the mortgagee (lender) or the trustor to the borrower.

The purpose of the Reconveyance Deed is to obtain a definite evidence of release of any lien/claim on the real estate by the former mortgagor. Reconveyance Deed is one of the final steps in the life cycle of a mortgage loan. It marks the full repayment and release of all liens by the mortgage lender.

Timing

State laws govern the timing of the issuance of the Reconveyance Deed. States require lenders to issue the document within 60 to 90 days of full repayment of loan.

Source :www.MortgagesAnalyzed.com

Borrower's Considerations

Review the Deed

You should review the deed to ensure it is accurate and correctly identifies the lien that is released, subject property, and the lender.

Record the Deed

You should ensure that the Reconveyance Deed has been recorded with the Country Clerk to demonstrate free and clear title to the real estate. It may become difficult to prove that the loan is paid in full and the lender has no claim on the property if the Reconveyance Deed is lost or if it was not recorded.

Source :www.MortgagesAnalyzed.com

Lender's Considerations

Review the Deed

Your servicing department should verify the contents of the deed to ensure deed is being issued for the correct loan and that the borrower has completely satisfied all the terms of the loan. You should consider incorporating a second level review before it the deed is issued.

Source :www.MortgagesAnalyzed.com

Document Summary

 
Reconveyance Deed
Purpose
Reconveyance Deed certifies that the lender or trustor has released its lien and conveyed all rights and interest in the real estate to the borrower upon full repayment or discharge of loan.
Use in Mortgages
A recorded Reconveyance Deed provides a definite evidence of release of any lien/claim on the real estate by the former mortgagor.
Other Names
  • Deed of Reconveyance
  • Satisfaction of Mortgage
  • Reconveyance of Trust Deed (Used when a Deed of Trust was used to secure the loan)
  • Release of Mortgage (used when a mortgage was used to secure the loan)
  • Release of Lien
Type
Deed
Provided By
Servicer on behalf of the Lender or Trustor
Provided To
Borrower
Notarization Required
Yes
Signed By
Officer or authorized person of the Lender or Trustor
Life Cycle Stage
Servicing
Recordkeeping
The borrower should keep the Reconveyance Deed along with other property documents as long as the property is owned.
Model Form
None
Applicable Laws
State Laws
Source :www.MortgagesAnalyzed.com

External Links

  1. FDIC, Obtaining a Release of Lien for procedures to follow when the mortgagor is a failed institution

Updated: Sep 08, 2013

Comments

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It is a document stating the borrower has fully repaid the loan and the lender is releasing its claim on the title
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