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updated: 7/6/2013 12:35 PM

What to do when the mortgage is paid off

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Q. Years ago my uncle lent me the money to buy our house, and we have finally paid off the mortgage. You mention how important it is to have a satisfaction certificate filed in the public records to clear the debt. How do we get that?

A. The document is known as a certificate of satisfaction in most states, but in some places it's a reconveyance deed. Either way, obtaining it and putting it on file is important. Otherwise the county's public records office will show the debt still out against the property. This could cause complications some time in the future.

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Your uncle is supposed to send you that certificate. In most states he's also responsible for having it entered in the records office. You could just ask him for it, or if you want to make things easier, have your own lawyer prepare it and send it to him with a request for a notarized signature. Then your attorney can enter it in the records, or you could take it down there and enter it yourself.

Q. My divorced daughter and her son live with me. My daughter qualified from Chase bank to borrow up to $130,000. She bid on a short-sale house for $89,000 (list price) and the seller agreed but the seller's bank came back for $94,000 and closing within 30 days. My daughter agreed and went to get the mortgage from Chase (she has a 20-percent down payment). The house was appraised OK at $96,000. After waiting for four weeks with no word from Chase, she was given a two-week extension to close. But meanwhile the house was put back on the market as "active" and was sold to someone else.

During the two-week extension my daughter was finally denied from Chase because her ex-husband was supposed to pay child support once a month. He gave her a lump sum for a year's child support to help with her down payment. He is paid up until August 2013. That's my first question -- do you find discrimination from Chase?

My second question is -- during the two-week extension the house was not listed as "sale pending," but as an active listing. The end of the two-week extension was April 20, my daughter was approved on April 17 by another mortgage company to which I cosigned. This mortgage company didn't inform our agent until April 19, a Friday night. He was going to inform the seller's bank on Monday, April 22. But on April 21 another person signed a contract on the house, and it was accepted.

As long as the extension was there shouldn't the house have been listed as "pending or contingent?" I know this is a long request, sorry about that, and thank you in advance. In the meantime she has found a different home.

A. Nice to hear it all had a happy ending.

For your first question: It's possible that because your daughter is already using next year's child support toward her down payment, that makes her monthly income too low to qualify for carrying the mortgage payments. She couldn't use the same money to help her qualify in two different places. That could explain the Chase turndown, and why you needed to cosign for the loan she did arrange. So it probably wasn't discrimination.

For the second question: Putting the house back on the market as "contingent" wouldn't have held it for your daughter beyond the extra two weeks. That other offer wasn't made until after her extension expired.

Q. Mary and her mother Sue own a house as joint tenants. Sue just died leaving no will. Mary is an only child and is the next of kin. There is a mortgage with both names on it. How and when can Mary get a clear title in her name? There is about $120,000 left on the mortgage and the house is worth about $180,000.

A. If two people own something as joint tenants, that means the property belongs to a group, which has those two people in it. When one dies, the same group still owns the property, but there's only one person left in the group. Simple as that. But as always when someone dies, Mary should have at least one session with a lawyer to make sure all necessary paperwork is filed.

• Edith Lank will respond to questions sent to her at 240 Hemingway Drive, Rochester, N.Y. 14620 (include a stamped return envelope), or readers may email her through askedith.com.

2013, Creators Syndicate Inc.

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