What Is a Mortgage Payoff Statement in Real Estate?
Updated for 2025 — clear guide for FSBO sellers and homeowners preparing to close.
A mortgage payoff statement (also called a payoff letter) is a document from your lender showing the exact amount needed to pay off your mortgage in full as of a specific date. It includes principal, interest, and any fees due at closing. Buyers, sellers, and title companies use it to ensure your loan is paid correctly when selling your home.
✅ How a Mortgage Payoff Statement Works
- Your lender calculates your remaining principal balance plus accrued interest through a chosen date (the good-through date).
- The payoff statement lists any unpaid fees, escrow shortages, or prepayment penalties.
- It provides wire or mailing instructions for sending final payment to the lender.
- Once paid, the lender records a satisfaction of mortgage or release, clearing the lien from your property.
This statement ensures all loan details are accurate before closing or refinancing your home.
💡 Why It Matters for FSBO Sellers
- Shows exactly what’s needed to satisfy your mortgage at closing.
- Prevents delays or surprises from unpaid interest or fees.
- Lets you verify the title will transfer free of any liens.
- Helps you calculate net proceeds before accepting an offer.
If you’re selling by owner, you’ll typically send your payoff request to your lender once a closing date is set.
📄 How to Request a Payoff Statement
- Contact your mortgage lender’s payoff or loan servicing department.
- Provide your loan number, property address, and desired payoff date.
- Most lenders email or fax the payoff letter directly to your title company.
- Payoff statements are typically valid for 10–15 days from the issue date.
Some lenders allow online requests through your mortgage portal, making it faster to close FSBO transactions.
💬 Frequently Asked Questions
- Is a payoff statement the same as a loan balance?
No. A payoff statement includes daily interest and fees up to a specific date — your regular balance does not. - Who requests the payoff letter when selling FSBO?
Usually the seller, or your closing agent if you’re using one. Brokerless sellers often request it directly from their lender. - What happens after payoff?
Your lender issues a mortgage release or satisfaction, removing the lien from public records.