Deed Of Release
What Is A Deed Of Release?
If you have a lien or mortgage on your home and property, in order to sell it you may need a deed of release. A mortgage loan means that you want to purchase a home but you do not have the full amount. Instead, you agree to let a financial institution cover the cost of the home and property and over a period of time you will be expected to pay the loan back in small monthly payments. This includes tax, interest, closing fees and the annual percentage rate. The financial institution will hold the deed to the home and property until it is completely paid off. If a person falls behind on there mortgage payments, their home and property can be foreclosed on.
Any home or property can be used for a lien. A lien holds the property as collateral for monies or services that were borrowed. Liens can be from money borrowed on car titles or any monies that were loaned out. There are different kinds of liens like new building or renovation liens. Before purchasing any type of property, you should make sure that the property has a clear title and no liens against it. If you are trying to sell a home or property that has a lien, you may also need a deed of release.
A deed of release states that the financial institution or owner of a property is satisfied with the debt that is owed. This happens when a person pays off a lien or a mortgage and owes no more money. A quitclaim or deed of release simply means that the title of the home or property is given back to the original owner.
If a person owes too much money on his home or property and wants to sell it to pay off the debt owed, he can also benefit from a deed of release. Usually this is discussed with the lender and some kind of agreement is made, that promises that the debt will be completely paid off. When the new buyer purchases the property he will get the deed and a clear title, unless he is also borrowing money from a financial institution.
A home owner can also use a deed of release to sell a portion of his property. This can be an attempt to pay off delinquent mortgage loans or liens. He can also discuss this with the lender and if the lender agrees to the terms he can sell the property with a clear title. The home owner will still not have access to the title but his mortgage can be paid down.
When any dispute rises between a lender and the home owner a deed of release can be used to insure payment. The deed can go to either party as a result of payment or lack of payments. This is a simpler way to cover a dispute than actually having to go to court. Along with the deed of release a settlement may also be attached. Whatever is specified in the settlement agreement has to be followed.
A deed of release indicates what if any actions have to be taken by each party, the stipulations for the release of the deed and the timeframe it will take to pay off the debt. When all of these things are done either a clear title can be produced or the ownership of the property goes back to the original owner.
If you are going to be purchasing land be careful of the person you are buying the land from. Make sure that there are no liens on the property and that it has a clear title.