Escrow & Title
In New Jersey, a 'satisfaction of mortgage' is the document that:
AProves the buyer has sufficient funds to close
BReleases the mortgage lien from the property once the loan is fully paid✓ Correct
CEstablishes the interest rate for the loan
DTransfers title from seller to buyer
Explanation
When a mortgage is paid in full in NJ, the lender provides a satisfaction of mortgage (also called a discharge), which is recorded in the county clerk's office to release the lien. This document clears the mortgage from the chain of title.
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Key Terms to Know
Chain of Title
The sequential record of all transfers of ownership for a piece of property from the original patent holder to the present owner.
LienA financial claim against a property that serves as security for a debt or obligation, giving the creditor the right to foreclose if unpaid.
Discount PointsPrepaid interest paid to a lender at closing to reduce the mortgage interest rate, with each point equal to 1% of the loan amount.
Abstract of TitleA condensed history of a property's title, summarizing all recorded documents and encumbrances affecting it from the earliest record to the present.
Math Concepts
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