🏡 What Is a Release of Mortgage in Real Estate?

A release of mortgage is a legal document that proves a borrower has fully paid off their mortgage loan. Once issued, the lender releases its claim on the property, and the lien is removed from public records.

How a Release of Mortgage Works

When a borrower pays off the final balance of their mortgage, the lender prepares a release of mortgage (also called a satisfaction of mortgage). This document confirms the loan is paid in full and removes the lender’s lien from the property’s title.

A release of mortgage includes:

  • Borrower name
  • Lender (mortgagee) name
  • Property address and legal description
  • Original loan date
  • A statement confirming full repayment

Once recorded with the county, the property becomes free of the lender’s claim, allowing the homeowner to sell or refinance without restrictions.

Why a Release of Mortgage Matters

Benefits for Homeowners:

  • Clears the mortgage lien from the property title
  • Allows refinancing or selling without title issues
  • Provides proof of full repayment

If a Release Is Not Filed:

  • The lien may still appear on title records
  • Closings can be delayed due to unresolved liens
  • The homeowner may need to request the lender to reissue the release

Example of a Release of Mortgage

A homeowner pays off the remaining balance on a $300,000 mortgage. The lender issues a Release of Mortgage and records it with the county.

  • The lien is removed from the property title
  • The homeowner now owns the property free and clear
  • The homeowner can sell or refinance without restrictions

This document acts as official proof that the mortgage obligation has ended.

Why Releases of Mortgage Matter for FSBO Sellers

  • Title companies require mortgage releases during closing
  • Missing releases can delay or block a sale
  • Sellers must verify all past mortgages are fully released
  • If a release is not recorded, sellers may need to request it from the lender