Once you finish paying off your mortgage, that does not mean you are totally free from the mortgage. The final step is receiving a notice from your lender that the mortgage has been paid in full and a Satisfaction of Mortgage has been recorded.
Your lender has an obligation to record a Satisfaction of Mortgage in the county where the property is located and send you notice that this has occurred. Pursuant to Florida Statute 701.04(2), after paying off a mortgage, the lender has 60 days to record a Satisfaction of Mortgage and provide the borrower notice that the Satisfaction of Mortgage has been recorded.
It is important for your lender to record a Satisfaction of Mortgage because it places the public on notice that the mortgage was paid off. If your lender fails to record a Satisfaction of Mortgage after you pay it off, then the public would only see an existing mortgage and assume that it was not paid of. This can cause problems. You will likely be unable to sell the home until a Satisfaction of Mortgage is recorded and, if you quitclaim the property, the state of Florida would seek to collect documentary stamp taxes from you based on the amount of the mortgage.
If a lender fails to record a Satisfaction of Mortgage within the 60-day period, then the borrower can file a lawsuit asking a court to require the lender to prepare and record a Satisfaction of Mortgage.
Note that a borrower that is forced to bring an action against the lender in court may be entitled to the borrower’s attorney’s fees and costs from the lender. See Florida Statute 701.04(2).