Your Mortgage Payoff

Understanding Your Mortgage Payoff

When a consumer refinances their mortgage, a payoff demand is provided by their current mortgage holder to itemize the amount needed to pay off the mortgage on the future estimated closing date of their new mortgage. 

The payoff demand will include the outstanding principal balance owed, interest that is due since the date of their last payment through the future estimated closing date of their new mortgage, mortgage insurance (if applicable), unpaid late fees, impound account shortages and any other fees due.

It is important for a consumer to understand that the balance on their last mortgage statement is not going to be the amount needed to pay off their mortgage on the future estimated closing date.  To understand how a consumer's bank arrives at the total amount due to pay off their mortgage, a consumer must understand that mortgage interest is paid "in arrears."  For example, the mortgage payment that is due in November does not pay November's mortgage interest forward, it pays the interest that accrued in the previous month of October.  Therefore, if a consumer refinances their mortgage in November, and thus does not make their November payment that would have paid the interest and mortgage insurance that accrued in October, then the amount of interest and mortgage insurance that would have been paid by November's payment will be added to the payoff demand provided by the consumer's current mortgage holder. 

Additionally, using the example above, since that consumer will not have to pay their mortgage in December (because they completed their refinance in November), the December payment that would have paid the mortgage interest and mortgage insurance accrued in November will also be included in the payoff demand.

Therefore, the payoff demand for a consumer refinancing in November will contain the principal balance due from their previous statement plus the interest and mortgage insurance that would have been paid by November's and December's monthly payment plus any late fees, escrow shortages and fees charged by their bank for the payoff.

 

 

 

Cornerstone Mortgage

MAIN OFFICE:
5940 S. Rainbow Blvd., Suite 201
Las Vegas, NV 89118
(702) 840-1500
NMLS ID 340311
NV: DML License: 4814
CA: DOC License: 60DBO86761
CA: DRE License: 01848420

NEVADA:
5940 S. Rainbow Blvd., Suite 201
Las Vegas, NV 89118
(702) 840-1500
NMLS ID 340311
NV: DML License: 4814
CA: DOC License: 60DBO86761
CA: DRE License 01848420

CALIFORNIA:
1500 Standiford Ave., Suite A1
Modesto, CA 95350
(209) 578-9000
NMLS ID: 1741490
CalDRE License: 01848420

200 Tampa St.
Turlock, CA 95382
(209) 633-3222
NMLS ID: 1739798
CalDRE License: 01848420

HAWAII:
91-110 Hanua St., Suite 201
Kapolei, HI 96707
(808) 784-1239
NMLS ID: 1669660
HI: MLOC Liense HI-340311

Legal

Cornerstone Equity Group, Inc., dba Cornerstone Mortgage is an equal opportunity lender.

Nationwide Multistate Licensing System (NMLS) ID: 340311. Additional NMLS branch licenses: 1739798, 1741490, 1669660.

Cornerstone Equity Group, Inc., dba Cornerstone Mortgage is licensed by the Nevada Division of Mortgage Lending, license number 4814.

Cornerstone Equity Group, Inc., dba Cornerstone Mortgage is licensed by the California Department of Corporations under the Residential Mortgage Lending Act and Finance Lenders Law. CA Finance Lender #60DBO86761.

Cornerstone Equity Group, Inc., dba Cornerstone Mortgage is licensed by the California Department of Real Estate, License number 01848420.

Cornerstone Equity Group, Inc., dba Cornerstone Mortgage is licensed as a Mortgage Loan Originator Company by the Hawaii Department of Commerce and Consumer Affairs, license number HI-340311.

Any concerns, complaints or suspicions regarding the misuse of any personal data should be directed to our Operations Manager by telephone at (702) 780-1500 or by email at admin@cornerstone.us.com.