Nationwide Mortgage Licensing System (NMLS) Practice Exam

Which document is usually NOT recorded?

1. Assignment of mortgage

2. Note

3. Deed

4. Mortgage

The correct answer is: Note

The note is typically not recorded in the public records, which is why it is the correct answer. The note represents the borrower's promise to repay the loan and contains the terms of the mortgage agreement, but it is considered a private document between the lender and the borrower. Recording the note is not standard practice because it does not create a public interest in the property, unlike the other documents listed. In contrast, the assignment of mortgage, deed, and mortgage are commonly recorded as they serve to provide public notice of the respective rights and interests in the property. The deed conveys ownership of the property, while the mortgage secures the lender's interest in that property. Recording these documents is essential for establishing priority of claims and ensuring transparency in real estate transactions.