What Is a Payoff Demand?
A payoff demand — closely related to a payoff statement — is a lender's formal statement of the exact amount required to pay a loan in full as of a specific date. It is "demanded" (requested) by the borrower or the closing agent so a loan can be satisfied at a sale or refinance. Because interest accrues daily, the figure is good only through the stated date.
What a Payoff Demand Includes
- The outstanding principal balance
- Interest accrued through the payoff date, often with a daily "per diem"
- Any fees, late charges, or prepayment penalties
- The good-through date and payment/wiring instructions
Why It Matters in Florida
At a Florida closing on a financed property, the title company orders the payoff demand so the precise loan balance can be paid from the proceeds. Paying it in full lets the lender release its lien and record a satisfaction of mortgage, clearing title for the new owner or new loan. An inaccurate or expired payoff figure can hold up closing, so the demand is timed to the expected closing date.
Related Terms
- Payoff Statement — The same figure, in statement form
- Satisfaction of Mortgage — Recorded once the payoff is made
- Mortgage — The loan being paid off
Barnes Walker Real Estate
Barnes Walker's title team orders payoffs, reconciles closing figures, and clears liens on Florida transactions. Request a legal inquiry for assistance.
Reviewed by the attorneys at Barnes Walker, Goethe, Shea & Robinson, PLLC