Request for a payoff and reconveyance

[Jeff Ju]

Hi all - I did a search here but couldn't find a consistent answer. Hoping for one here. 

Situation: This is my first time lending money. It is a first position note for 12 months to a borrower who paid 6 months of interest in advance. The 6-month period is coming up and I received the following from a title company seems to be the escrow company handling the case. Is this normal and should I sign/send the original note as requested? 

Documents needing to be filled out copy/pasted (replaced borrower name with "Borrower, LLC"). 

A transaction has been opened with this company and we have been instructed to request a DEMAND FOR

FULL PAYOFF of the Loan identified below. Please complete and execute the "Demand for Full Payment"

attached hereto and return the original to us with the other documents specified in the Demand for

Full Payoff (including the original note).

Loan Information: Present Owners: Borrower, LLC

Original Trustor: Borrower, LLC., a California limited liability company

Deed of Trust Recorded: County: Los Angeles

Book: Page: Series No.:

For your convenience, and in an attempt to expedite the reconveyance of the Loan after full payoff in accordance

with the Payoff Demand, we have included a "Substitution of Trustee and Reconveyance" form.

IMPORTANT: The "Substitution of Trustee and Reconveyance" form must be executed in the presence of, and

notarized by, a Notary Public. Notary Public services are available in many of our offices. Please call if you

wish to make arrangements to execute this document at one of our offices.

CALIFORNIA CIVIL CODE 2943 PROVIDES FOR A SUBSTANTIAL FINE IF THE BENEFICIARY FAILS

TO PREPARE AND DELIVER THE PAYOFF STATEMENT AND DELIVER THE NECESSARY DOCUMENTS

WITHIN 21 DAYS AFTER RECEIPT OF THE WRITTEN REQUEST. PLEASE REFER TO THE LAW FOR

FURTHER DETAILS.

Civil Code Sections 2941 and 2943 provide for the following:

1. If the fee for the reconveyance is not included in the Payoff Demand, the fee cannot be charged to the

consumer. However, failure to include the fee does not excuse the lender from the obligation to

reconvey the deed of trust.

2. $45.00 is the maximum fee for a reconveyance conclusively presumed by California law to be reasonable.

3. $30.00 is the maximum fee for a payoff demand statement that can be charged under California law.

Page 2 of 5

To: Title Company ("Escrow Holder")

Estimated Closing Date: In two weeks

Re: Property address ("Property")

("Seller")

__________________________________________________________________________________________

DEMAND FOR FULL PAYMENT

PLEASE COMPLETE IN FULL

Enclosed are:

1) Original Note for $_________________________________

2) Deed of Trust (original preferred), and

3) Substitution of Trustee and Deed of Reconveyance executed by all beneficiaries. Signature must be notarized.

At the close of escrow, Escrow Holder is instructed to:

1. Pay the beneficiary the principal sum of $_______________________________ plus interest at

____________________% per annum from _________________________, 20_____ to the date of close

of escrow;

2. Record the Substitution of Trustee and Deed of Reconveyance;

3. Destroy the Original Note or mark said note as "Paid" and deliver as instructed by Seller/Borrower.

Escrow Holder is instructed to charge the borrower recording fees for the Substitution of Trustee and Deed of

Reconveyance.

__________ (Initial if applicable) Escrow Holder is instructed to charge the borrower $30.00 for the payoff

demand statement which is to be paid to the undersigned.

Additional Instructions: _________________________________________________________________________

____________________________________________________________________________________________

Disbursement shall be made by Escrow Holder's check and mailed to the address below, unless otherwise

instructed by the undersigned in writing.

Date: ___________________

______________________________________________ __________________________________________

Beneficiary Signature Beneficiary Signature

Address: ______________________________________ Telephone No.: _____________________________

______________________________________________

IF YOU DO NOT HAVE THE ORIGINAL NOTE AND DEED OF TRUST,

PLEASE CONTACT THE ESCROW OFFICER IMMEDIATELY

FOR FURTHER INFORMATION

Page 3 of 5

RECORDING REQUESTED BY

Title Company

AND WHEN RECORDED MAIL DOCUMENT TO:

Space Above This Line for Recorder’s Use Only

SUBSTITUTION OF TRUSTEE AND FULL RECONVEYANCE

The Undersigned, present Beneficiary under that certain Deed of Trust dated executed by Borrower,

LLC., a California limited liability company, as Trustor to as original Trustee and recorded on as

Instrument No. , in Book , Page(s) , Official Records of the County of Los Angeles, State of

California, HEREBY APPOINTS AND SUBSTITUTES THE UNDERSIGNED as the new and substituted

Trustee thereunder in accordance with the terms and provisions contained therein, whose address is .

As such duly appointed and substituted Trustee thereunder, the undersigned DOES HEREBY RECONVEY to the

person or persons legally entitled thereto, without warranty all the estate, title and interest acquired by the

original Trustee and by the undersigned as the said substituted Trustee under said Deed of Trust. Wherever the

text of this document so requires, the singular includes the plural.

Dated: _____________

_________________________________________ _________________________________________

A notary public or other officer completing this certificate

verifies only the identity of the individual who signed the

document to which this certificate is attached, and not the

truthfulness, accuracy, or validity of that document.

STATE OF )SS

COUNTY OF )

On before me, , Notary Public, personally appeared

who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within

instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by

his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the

instrument.

I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.

Signature

This area for official notarial seal.

A notary public or other officer completing this certificate

verifies only the identity of the individual who signed the

document to which this certificate is attached, and not the

truthfulness, accuracy, or validity of that document.

STATE OF )SS

COUNTY OF )

On before me, , Notary Public, personally appeared

who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within

instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by

his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the

instrument.

I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.

Signature

This area for official notarial