Investopedia explains that "full reconveyance" occurs when a deed of reconveyance is issued by a mortgage holder, indicating that the borrower is released from his mortgage debt. Full reconveyance is issued when a borrower has fully pays the mortgage on a home.
A deed of reconveyance transfers the property title from the lender to the borrower, according to Investopedia. The deed contains a description of the property, a parcel number and a notarization. It's recorded in the county that the property is located in, and any searches on that property reveal that the mortgage has been paid. A home with a mortgage on it cannot be sold unless proceeds from selling the home are used to pay the mortgage in full. When the home is sold, the title insurance company includes the deed of reconveyance in the closing. During the time that the borrower has an open mortgage on his home, the lending company uses the home as security interest. If the borrower does not pay his mortgage in a timely matter or stops paying completely, the lending company may foreclose the home and evict the borrower, according to Investopedia. The lending company then sells the home to complete the mortgage payments. When the borrower has received his deed of reconveyance, the lending company can no longer keep the home as security interest.