How are mortgage payoff amounts calculated?

[Doc_Lobster]

I was thinking the balance after the last payment plus X days of interest.

Is it more complicated than that? Because the payoff amount listed on our closing papers seems about $600 to high, but the title company people said that was the number that the bank gave them.

[eatsrainbows]

You should be able to find a calculator online. There are a lot of factors that go into it (do you have pmi, are you including your property taxes, %, closing costs).

[eatsrainbows]

Reading fail on my part, ignore me, lol!

[Doc_Lobster]

To use real numbers, our balance after the May payment was $112,263 and our rate is 5.01%. The estimated payoff shown on our online account is $112,522. This is close to my back of the envelope calculation. The closing papers list the payoff amount as $113,156.

It might be too late now to do anything. I signed because even though it seemed a little high, I couldn't remember what the balance was and just trusted the banks numbers. I just need to know if I'm being an idiot before I call them and bitch about it.

[nestbrenda]

I think you should call.

[Doc_Lobster]

So I'm not being an idiot (about this, anyway)?

I'll call in the morning.

[nestbrenda]

Well I'm a bigger idiot, because I've signed on dozens and dozens of closings, and I don't know the answer. I feel like they could have gotten the amount wrong and could write you a check. Or they'll explain why they're right. Either way, you certainly don't look like an idiot for asking a question!

[AngGee]

Just to let you know there is more that goes in to a pay off of a mortgage than just how you calculated it. They have a per diem rate, also they charge for the payoff statement and any other thing they can charge you for. But if the title company pays more than you owe they will reimburse you the difference. Hope this helps a little bit.

ETA: But you sure can call the title company and ask for a copy of the payoff statement and that should explain the difference.