People often have doubts about how long they should keep specific financial records, especially when the tax season is approaching. The answer depends on the type of receipt. It can be a few months, six years or even forever. According to the IRS, it will depend on the “action, expense or event which the document records.” If you have ever bought or sold a house, for example, you probably have a stack of papers or endless online receipts regarding the mortgage.
TL;DR (Too Long; Didn't Read)
You'll want to keep your mortgage payment receipts until you have been given proof from the creditor that the property has been fully paid off.
Saving Receipts and Important Paperwork
The IRS advises that people should save their tax returns and paperwork supporting the information on their tax returns for at least three years. That is the period of time in which the IRS is allowed to audit someone.
According to certified public accountants and business advisers, people should keep all their payment receipts until the property is entirely paid off, and they receive an official confirmation from the creditor, known as a release of lien or certificate of satisfaction. These documents are written proof that there are no debts between the creditor and the owner of the house. Payoff documents may vary for other types of loans.
The deed and mortgage payoff documents are the definitive proof that a person owns the property and has paid the total amount to the creditor. Specialists advise that people should keep these documents as long as they own the house. Even after selling it, they should consider saving the records for at least three years.
Other types of documents that people should keep for an extended amount of time include home sale closing documents, receipts of capital investments, IRA contribution records, retirement statements, and credit card statements.
How to Organize Online Documents
There is no need for people to keep a pile of paper to organize their payments and receipts anymore. Many people choose to pay their mortgage online or by using automatic payment. Payment information and historical data can then be found through your online banking account and your lender's website. It is also possible to save documents by using cloud storage, where you can access the files from most devices. Oftentimes, cloud storage services provide a limited amount of free storage space.
Where to Find Mortgage Documents
The deed and mortgage documents are considered a public record and are available at the office of the county recorder. In the event that you need to find these documents, it is possible to request a copy from the recorder's office or from a title company.
Luana Ferreira has a bachelor in journalism since 2010. She started her career on television in Brazil, working as a producer for newscasts, but soon moved to print and online publications. She works as a freelance writer since 2012 and has written about finances, business and entrepreneurship for prestigious publications like BBC, Entrepreneur, Playboy and Sapling.