If you’d like to sell your current home, but the mortgage isn’t paid off yet, it is an extremely common thing to do. The DiMora Team are real estate experts in the Novi and Northville neighborhoods and most of our sellers have a mortgage when they go to sell their home. So thankfully, you are not stuck in a home until you pay off every last dollar. Here are the quick points to know on how to sell a house with a mortgage:
- You’ll use the proceeds from the sale of your home to pay off your existing mortgage balance. Your lender will receive their payout at the time of closing.
- After satisfying the mortgage debt and covering additional selling costs such as commissions and taxes, you will (hopefully!) have some profits to take home.
- If the amount received from the sale falls short of your outstanding mortgage balance and selling costs, you will have to cover the difference with funds other than those from the sale.
- In today’s market where property values have seen steep rises, it isn’t common for sellers to owe more than their home is worth, a situation that’s known as being “underwater.”
- A mortgage is more likely to become underwater if a seller falls behind on mortgage payments, sells before they’ve gained much equity, or sells during a market downturn.
Next, you need to find out how much you owe on your mortgage. Your lender is required to provide the total amount required to satisfy the mortgage debt as of a specified date, according to the Consumer Financial Protection Bureau, a figure known as the payoff amount. Check out below to see what sold in Tuscany Reserve in November 2021:
20930 Barola Drive, Novi: 5 bedrooms, 5.1 bathrooms, 5,376 sq. feet, 4 car garage, Sold Price: $2,335,000
Tuscany Reserve Home Sold
November 2021
The payoff amount includes any interest you owe until the day you plan to pay your loan in full. Once you close on your house, your escrow company will coordinate with your lender to get an updated payout amount and use your home sale funds to pay off the debt in its entirety. For more information on Tuscany Reserve, or similar Northville or Novi neighborhoods such as Fox Hollow, Stonewater and Turnberry Estates, contact The DiMora Team today at 248-505-7728 or jim@dimora.com.