Reduction Certificate


Reduction Certificate

A document signed by a lender stating the outstanding amount on a mortgage loan. Properties that are encumbered by mortgages are frequently sold before the debt is satisfied. The sale of the mortgaged property most often involves a cash sale where the existing mortgage is paid off. In some cases, however, the buyer may assume the existing loan as part of the purchase price. In this case, the parties obtain a reduction certificate from the lender specifying the exact amount of money that is due on the loan.

A reduction certificate is also known as a "payoff statement".

The option for a buyer to assume an existing mortgage is appealing during times of high interest rates. By assuming the existing mortgage, the buyer may be able to secure the lower interest rate associated with the loan, which may have been originated during a period of lower interest rates. The seller would need a release from the lender discharging him or her of any liability on the debt.


Investment dictionary. . 2012.

Look at other dictionaries:

  • Certificate of identity — A certificate of identity, sometimes called an alien s passport, is a travel document issued by states to stateless persons residing within their borders and foreign nationals who are unable to obtain a passport from their state of nationality.… …   Wikipedia

  • certificate of necessity — a document issued by a certifying government agency under authority of which the internal revenue service allows deductions from taxable income for accelerated amortization of all or a part of the cost of emergency facilities * * * certificate of …   Useful english dictionary

  • certificate of deposit — /sə tɪfɪkət əv dɪ pɒzɪt/ noun a document from a bank showing that money has been deposited at a certain guaranteed interest rate for a certain period of time. Abbreviation CD ▪▪▪ ‘…interest rates on certificates of deposit may have little room to …   Dictionary of banking and finance

  • Display Energy Certificate — Contents 1 Display Energy Certificates (DECs) 2 See also 3 External links 4 References Display Energy Cer …   Wikipedia

  • Carbon Emission Reduction Target — The Carbon Emission Reduction Target (CERT) in the United Kingdom (formerly the Energy Efficiency Commitment) is a target imposed on the gas and electricity transporters and suppliers under Section 33BC of the Gas Act 1986 and Section 41A of the… …   Wikipedia

  • National Health Insurance (Japan) — National Health Insurance (国民健康保険, Kokumin Kenkō Hoken?) is one of the two major types of insurance programs available in Japan. The other is Employees Health Insurance (健康保険, Kenkō Hoken …   Wikipedia

  • education — /ej oo kay sheuhn/, n. 1. the act or process of imparting or acquiring general knowledge, developing the powers of reasoning and judgment, and generally of preparing oneself or others intellectually for mature life. 2. the act or process of… …   Universalium

  • Pratt & Whitney Canada PT6 — The PT6, manufactured by Pratt Whitney Canada, is the most popular turboprop aircraft engine in history. [ [http://www.utc.com/profile/facts/history.htm United Technologies history] ] It is produced in a wide variety of models, covering the power …   Wikipedia

  • EDUCATION — Pre State 1880–1914. Education in the small yishuv, which numbered about 25,000 in 1880, largely resembled the traditional types prevailing in Jewish communities elsewhere. The Jews of East European origin maintained the traditional ḥeder, talmud …   Encyclopedia of Judaism

  • Gun politics in the United Kingdom — Gun politics in the United Kingdom, much like gun politics in Australia, places its main considerations on how best to ensure public safety and how deaths involving firearms can most effectively be prevented. Unlike in the United States, there is …   Wikipedia