Payoff Estoppel Letter Sample Template with Examples [Word]

It is typically provided by the lender to the borrower, or to a third party acting on the borrower’s behalf, such as a title company or attorney, and serves as a confirmation that the loan will be satisfied upon payment of the specified amount. The purpose of this Payoff Estoppel Letter is to protect both the lender and the borrower in the transaction. For the lender, it ensures that they receive the full amount owed on the loan, and for the borrower, it provides a guarantee that the loan will be fully paid off once the specified amount is paid. 

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In addition, an estoppel payoff letter can be useful for other parties involved in the transaction, such as title companies, real estate agents, and attorneys. These parties rely on the information contained in the letter to accurately calculate closing costs and ensure that all liens on the property are cleared before the transaction is completed. 

One of the key features of this letter is the concept of estoppel. Estoppel is a legal principle that prevents a person from denying or contradicting a statement that they have previously made. In the context of a payoff estoppel letter, the lender is estopped from demanding any additional payments beyond the specified amount, and the borrower is estopped from disputing the validity of the information provided in the letter.

Sample Payoff Estoppel Letter Template with Examples

If you purchase a payoff letter template from templatediy, you can be sure you’re getting a high-quality document that will help you get the most out of your legal situation. This template is accurate and easy to use, so you’ll be able to produce an effective letter in no time at all.  

To create a valid payoff estoppel letter, the lender must carefully review the terms of the loan agreement and calculate the outstanding balance, including any interest or fees that may have accrued since the last payment was made. The letter must also include a statement indicating that the lender will release the lien on the property once the specified amount is paid.