Releasing a mortgage lien

A lien is a legal claim against property that must be satisfied when the property is sold. The lien provides notice that the bank has a secured interest in the property and guarantees the bank that the property cannot be sold or transferred without either the loan being repaid or assumed.

Here are some commonly asked questions about mortgage lien releases.

How does a lien get released?

When a bank loan is paid off, a Release of Lien or Certificate of Satisfaction is provided by the bank and is recorded in the Land Records office to provide notice that the prior lien has now been paid in full and released from the property.

When I refinance, what is the lien release process?

In a refinance, the title company handles paying off the bank and is responsible for following up to make sure that the lien has been released.  Most title companies charge either a lien release fee, or include the fee as part of the settlement fee.

What about when I sell my house?

The same thing is true when a property is being sold.  The title company is responsible for handling the release since it has provided a commitment to the bank that the prior loan will be paid and released.

I just paid off my loan by writing a check; do I need to do anything else?

Yes, you need to make sure that the lien has been released.  Either the lender will send the release to the county or city Land Records office on your behalf and forward you the recorded release, or they will send you the recorded release, which you will then have to record.

I have an equity line with a zero balance.  Does that need to be released?

Just because your equity line has a zero balance does not mean that it has been released from the property.  You need to request for the account to be closed and for a release to be sent to you.

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