As a Polk County, Florida homeowner, you’ve poured your heart and soul into your home, creating cherished memories within its walls. But sometimes, life has a way of reshuffling the cards, leaving you with unexpected circumstances that prompt the need for change. Whether it’s a career opportunity in a new city, a growing family that requires more space, or a shift in your financial landscape, you might find yourself at a crossroads, wondering if selling your house is the right move. And then it hits you: “I still have a mortgage. Can I even sell my home in this situation?”
If these thoughts have crossed your mind, you’re not alone. Many homeowners in Florida find themselves navigating the complex waters of selling a house with a mortgage.
The short answer is yes, you can absolutely sell a house with a mortgage. At Lincoln Madison Investments, we’ve helped countless clients in Lakeland and throughout Polk County Florida navigate the process of selling a home with a mortgage.
How To Sell A Home With A Mortgage
Step 1. Find And Understand Your Mortgage Payoff Amount
The first step in selling a house with a mortgage is to determine your remaining loan balance. This is the amount you’ll need to pay off your lender when you sell your home.
Contact your lender for a payoff statement
Contact your mortgage lender and request a payoff statement. This document will provide you with the exact amount you need to pay to satisfy your mortgage, including any interest and fees. At Lincoln Madison Investments, we always recommend our clients obtain a payoff statement early in the selling process to avoid any surprises at closing.
Step 2. Determine The Right Time To Sell
Consider factors such as your local housing market conditions, your personal financial situation, and your reasons for selling to determine if now is the right time to sell a house with a mortgage.
Step 3. Estimate Your Home’s Market Value
Before listing your home, research recent sales of comparable properties in your area to get an idea of your home’s current market value. This will help you set a realistic price and estimate your potential net proceeds from the sale.
Step 4. Calculate Your Selling Costs
In addition to paying off your mortgage, you’ll need to cover various selling expenses such as real estate agent commissions, closing costs, and any necessary repairs or upgrades. Factor these costs into your budget to ensure you have sufficient funds available.
Step 5. Notify Your Lender of Your Intent to Sell
Once you’ve decided to sell a house with a mortgage, inform your lender of your plans. They may require certain documentation or have specific procedures to follow during the selling process.
Step 6. Find a Real Estate Agent
Working with an experienced real estate agent can make the process of selling a home with a mortgage much smoother. They can help you price your home competitively, market it effectively, and navigate the complexities of the selling process.
Step 7. Set A Fair Listing Price
Based on your home’s estimated market value and your selling costs, work with your real estate agent to set a competitive listing price that will attract potential buyers.
Step 8. Prepare Your House To Sell And Stage
Make any necessary repairs, declutter, and stage your home to make it as appealing as possible to buyers. A well-presented home can sell faster and for a higher price.
Step 9. Market your house
Your real estate agent will use various marketing strategies to promote your home to potential buyers, such as listing it on the MLS, hosting open houses, and utilizing online advertising.
Step 10. Sell The Home And Pay Off Your Mortgage at Closing
Once you accept an offer and the sale closes, the proceeds will first be used to pay off your outstanding mortgage balance and any other liens on the property. Your lender will provide a final payoff amount to the closing agent to ensure the loan is satisfied.
Step 11. Keep The Remaining Funds From The Sale
After your mortgage and all other selling expenses are paid, any remaining funds from the sale are yours to keep. You can use this money to purchase a new home, invest, or save for the future.
About Selling A Home With A Mortgage FAQ’s
Can You Sell A Home With Negative Equity?
Yes, it is possible to sell your home fast even if you have negative equity (owe more on your mortgage than your home is worth). This is known as a short sale. In a short sale, your lender agrees to accept less than the full amount owed on the mortgage, allowing you to sell the property and avoid foreclosure.
Can You Qualify For A Mortgage Before Selling Your House?
Yes, you can qualify for a new mortgage before selling your current home. This is known as a contingent loan, where your new mortgage approval is contingent upon the successful sale of your existing property. Keep in mind that not all lenders offer contingent loans, and you may need to meet specific criteria to qualify.
Can you sell a house with a mortgage before it's paid off?
Yes, you can absolutely sell a house with a mortgage before it’s fully paid off. In fact, most homeowners who sell their homes are still paying off their mortgages. The proceeds from the sale will first be used to pay off your outstanding loan balance, and any remaining funds are yours to keep.
Can I make money on a house I still owe on?
Yes, you can make a profit on a house you still owe money on, as long as your home’s market value is higher than your remaining mortgage balance and selling costs. For example, let’s say you owe $150,000 on your mortgage, and you sell your home for $200,000. After paying off your loan and covering selling expenses, you would keep the remaining profit.
How soon can I sell my house after buying it?
Technically, you can sell your house immediately after buying it. However, if you sell too quickly, you may incur capital gains taxes on any profits. To avoid this, most experts recommend waiting at least two years before selling a primary residence. Additionally, some lenders may charge a prepayment penalty if you pay off your mortgage within a certain timeframe, so be sure to review your loan terms carefully.
What happens to your mortgage when you sell your house?
When you sell a house with a mortgage, the proceeds from the sale will first be used to pay off your outstanding loan balance. Your lender will provide a payoff amount to the closing agent, ensuring that the mortgage is fully satisfied. Any remaining funds after paying off your loan and covering selling costs are yours to keep.
How soon can you sell a house after buying it?
While there’s no legal requirement to wait a specific amount of time before selling a house you recently bought, it’s generally recommended to hold onto a property for at least two years. This is because selling too quickly can result in capital gains taxes on any profits, and some lenders may charge prepayment penalties for paying off a mortgage early. However, if your circumstances change and you need to sell sooner, it is possible to do so.
Can you sell a house without paying off the mortgage?
No, when you sell a house with a mortgage, you must pay off the outstanding loan balance at closing. The proceeds from the sale will first go towards satisfying your mortgage, and any remaining funds are yours to keep. If you attempt to sell a house without paying off the mortgage, your lender can take legal action to protect their interest in the property.
Should I tell my mortgage company I am selling?
Yes, it’s crucial to inform your mortgage lender as soon as you decide to sell your home. They may have specific requirements or procedures you need to follow during the selling process. Additionally, notifying your lender early on can help ensure a smooth and timely closing, as they will need to provide a final payoff amount and release their lien on the property.
What is the fastest way to sell a home with a mortgage?
LMI – Cash Buyer
If you need to sell a house with a mortgage quickly, consider working with a cash buyer like Lincoln Madison Investments. We buy ugly houses with a mortgage without the hassle of a traditional sale. We can make you a fair, all-cash offer and close on your timeline, often in as little as 7 days. This can be a great option if you’re facing financial hardship, need to relocate quickly, or simply want to sell your home fast. We specialize in helping homeowners in LakelandDavenport, Winter Haven, and throughout Polk County, Florida. Give us a call today at 863-521-0549 for a free, no-obligation consultation. Our friendly and knowledgeable staff is standing by to answer any questions you may have and guide you through the selling process. You can also contact us for a free cash offer online through our website, and one of our representatives will get back to you promptly. Get a fast cash offer now and let us work for you so you can find the best solution for your unique situation.