To ensure smooth closings, a payoff letter is needed
A Home Equity Line of Credit (HELOC) is unique in that it is not an installment loan paid off with regularly scheduled payoffs (installments), but is a revolving source of credit with the ability for the borrower to draw and repay funds for periods of time. Given the difference in the way HELOCs are paid off, the payoff documentation required for HELOCs is different.
Payoff documentation for HELOCs is different from an installment loan in that a payoff letter is required to close out the lien – a monthly payment statement is not acceptable. Specifically, a payoff letter on the bank’s letterhead is needed with the following information:
- The amount due in order to pay off or pay down the account;
- A statement that the account has been closed and that access to withdraw additional funds has been frozen;
- Language that a release or satisfaction has been or will be sent to the county recorder’s office;
- The contact information for the person who issued the payoff statement.
It is our priority to provide you with first-class customer service for your borrowers, which involves ensuring that you have the resources to understand the payoff documentation needed prior to closing.
If you have any questions about HELOC payoffs, please reach out to our customer support team via form, email, or phone.
Faster Closings with Faster Turntimes
At Advocus Title, we know that you want to provide your borrower with the fastest closing experience in the market. That’s why we are committed to reducing our turntimes throughout 2021 to provide you with best-in-class speed to close. To provide transparency and allow you to best manage your closing process, we publish our state-by-state turntimes to an initial title commitment on the GR Intranet. Check out the latest to see how Advocus Title can help improve your speed to close.
