If you handle real estate transactions as part of your business, you have to do lots of research. Real estate is one of the biggest investments most people make, so it’s important that you help your clients prepare properly for this purchase, and that can mean giving them the information that can help them get the best deal possible. When they have ample information, they should be able to make smarter, more informed decisions. Looking up property and mortgage records is a great way to get them started.
How Mortgage Records Are Used
Public mortgage records can tell you a lot about a home and its owner. Potentially, your clients could leverage this information to get a better price. For example, mortgage records may show if the sellers are divorcing. Using this information, your client could offer a lower price, knowing that the sellers are motivated to get rid of the property.
You also can find out how many times the home has been listed, removed, and relisted. This gives you peek into the listing and potential problems: Did the owner remove it because the market was slow or because something was wrong with the house? Was the seller just testing the market the first time? If so, it may mean the owner is motivated to sell, again giving your client an opportunity to offer a lower price.
Mortgage Records and Promissory Notes are Not the Same Thing
Many clients confuse promissory notes and mortgages or think they're the same thing. They aren’t. While a promissory note is the borrower's promise to the lender, the mortgage is what secures that promise. When one buys a house, the purchaser signs a promissory note, essentially an IOU. This is the promise to repay the loan.
A promissory note contains:
- The names of the borrowers,
- The location of the property,
- The value of the loan,
- The terms of the loan, and
- The interest rate, whether it’s fixed or adjustable.
As with an IOU, the lender keeps the promissory note on file until it is paid. Once paid in full, the note is returned to the homeowners. The mortgage gives the lender the power to ensure the loan is repaid and the power to reclaim the property it if need be. Essentially, the mortgage document allows lenders to demand payment and foreclose on property if the terms of the mortgage aren’t met.
The public record of a mortgage document shows:
- The names of the borrowers,
- The location of the property,
- The property description in legal terms,
- Whether the loan is in good standing, and any
- Assignments or endorsements on the loan.
The mortgage becomes a public record soon after it is signed and remains a public record for the loan’s duration. Once the mortgage is fully paid, the lender releases the mortgage.
Before that time, however, lenders can sell a mortgage to another lender. This assignment will be recorded with the mortgage records. You can also find out if ownership of the loan has transferred by looking at endorsements. If another lender takes over the loan, the promissory note will be signed over in an endorsement.
Accessing Public Mortgage Records
So how do you find all this information? First, you need to obtain information on the current homeowner. In most cases, you'll be able to find what you need with the name; you may also need the full address or other identifying information.
- Step 1: You need to know what county the property is in. Then, find out where that county keeps its records. Some counties keep mortgage records in the courthouse or clerk's office. In some cases, the town itself handles the document. Go to the website of whichever office maintains the records.
- Step 2: On the website, there will be a form to fill out to access records. Enter all the information it requires to see the results. Some websites will allow you to view records online; others might require that you physically go to the office.
- Step 3: If you have to go to the office, someone there should be able to help you find the documents you need. You should be able to view hard copies of the mortgage records. There may be a small fee to access records.
In addition, mortgage professionals can find mortgage records from around the United States without leaving home at CourthouseDirect.com.
