Selling a mortgaged house is a common real estate transaction. If you want to move out of your home but still have outstanding mortgage payments, you have the option of selling and using the proceeds to cover the amount of your remaining balance.
Are you interested in selling your home with an outstanding mortgage? Here is a quick guide to the basics.
One of the first steps to selling a home with a mortgage is to find out how much you still owe. Your mortgage lender can provide you with the amount needed to pay off the loan at a specified deadline in a payoff quote. The amount will include both principal and interest, and a breakdown of any additional fees you might have to pay.
There are multiple ways to determine the value of your home. It’s a good idea to work with a real estate agent with extensive experience in your area to help figure out what amount to ask for in the sale.
Knowing your home equity, which is the difference between market value and leftover mortgage balance, is crucial to this process. A real estate agent can help you determine both your earned equity and home investment equity for your property before the sale.
The selling price for your home should correspond to market expectations and reflect what buyers would likely pay. However, since the proceeds from the sale will pay off the mortgage and closing costs - including property taxes and any fees to the title company - you want to choose a price that will benefit you.
Your agent can provide a comparative analysis of your home's condition and help you decide on a price. The comparative analysis combines key information, such as sale prices and local trends, for the complete picture of the home.
Sometimes, it may be necessary to sell a property for a lower price than your outstanding mortgage balance. This strategy is called a short sale, and must be approved by your lender. However, if you’re facing financial difficulties and in danger of default, short selling is a better alternative to foreclosure.
Many homeowners wish to move out of their home before their final mortgage payment. Luckily, selling your home with a mortgage balance is common practice that any great real estate agent can assist you with.
I grew up in a small town in Wyoming and married my high school sweetheart. I purchased my first home when I was 18 and immediately found a passion for real estate. One year later, I passed the Wyoming Real Estate Exam, and successfully purchased my second property! I love to help people navigate the real estate process and connect with my customers to help them achieve their real estate goals! With more than 25 years of experience in the industry – including residential, commercial, timeshare sales, and property management: I thrive on new opportunities to assist Buyers and Sellers. When not listing a property or negotiating an offer, you may find me on the beach enjoying some "Salt Life", volunteering at my child's school, and helping out in the community. Finally, I am proud to sit on the board of directors of a dedicated 501c3 foundation & help veterans, active service members, & first responders find relief from PTSD through scuba diving.
