What is a Certificate of Satisfaction? - Insurance Navy. A Certificate of Satisfaction is a legal document that is issued by a mortgage lender or a financial institution to indicate that a borrower has fully paid off their mortgage or loan. This document serves as formal proof that the borrower no longer has any financial obligations towards the lender in relation to the specific loan or mortgage. The Certificate of Satisfaction contains essential details such as the borrower’s name, the lender’s name, the original loan amount, the date when the loan was fully paid off, and a statement confirming that the loan has been satisfied.
It is typically recorded in the public records of the county where the property is located, effectively releasing the lien on the property. In the context of insurance, a Certificate of Satisfaction can be essential in cases where a claim has been made for damage to a property. If the property owner pays off their mortgage, the insurance payout may go directly to them.