Sometimes, homeowners want to sell their places. Maybe they want to size up, scale down, move neighborhoods, or get away from nosy or loud neighbors. Whatever the reason, if you still have a mortgage on your property, you might worry that selling will be complicated. Good news! Selling a home with a mortgage is simple if you follow these tips.
Know How to Address the Mortgage
Find out your home’s payoff amount. This is the sum you’ll need to make on the sale to clear out your mortgage.
- Positive equity
If you owe less on your home than it’s worth, the difference in what you can sell it for and what it’s worth is the equity. This is the amount you can reasonably expect to net from the sale.
- Negative equity
If you owe more on the house than it’s worth, you have negative equity. You can still sell the home, but you’ll need a plan for covering the difference between what you sell it for and your payoff balance.
Decide When to Sell Your Home
In a perfect world, you would always be able to offload your property during a seller’s market. But that’s not always the case, in reality. Figure out when you want to move. If you’re being relocated for your job, you’ll have a higher priority on moving than if you simply want a bigger place. There are typically more active buyers in spring and summer, but fall and winter aren’t bad choices, either.
Hire an Experienced Real Estate Agent
Find a reputable real estate agent who specializes in working with sellers. Make sure they understand the market, your neighborhood and property, and can answer all of your questions. An agent is priceless in helping you navigate the selling journey and helping you get as much as possible out of your property.
Determine an Asking Price
Do a little research about recent sales, talk to your agent, consider the shape your home’s in, and set a price. If you want to sell it fast, opt for a lower price that will entice more buyers. If you can handle a longer selling process, you can price it higher. Don’t overprice it, though, because that will turn many buyers off, and they won’t even come to view it.
Figure Out Where You’re Going to Live
Prepare for your move after your home sells. Are you buying another place, renting, or living with family? In a hot seller’s market, it’s a smart move to line up a home purchase in advance. However, buying a home before selling your current one can be complicated, especially if that means you’ll have two mortgages before you sell.
Talk to a loan originator about your options.
It’s go time! Get your property out there and let your agent do their job. Make your place pleasing by keeping it clean and decluttered, so it shows well.
Once the offers roll in, study each one carefully. Are you willing to make concessions? Drop the price? Take an offer contingent on the buyer selling their current home? This stage is another area to lean heavily on your real estate agent for guidance.
Accept an Offer
Once you find a buyer with an acceptable offer, accept it and move toward closing. If the buyer needs a mortgage, your home will need to go through an appraisal process. Schedule any of the improvements you agreed to make, and be prepared for a home inspection as well.
Pay Off Your Mortgage at Closing
Closing day will be here before you know it. You and your agents will be present along with the buyer and their agents, and the title representative. Once the buyer (and their lender) pay for your property, you’ll turn around and pay your mortgage off. If you have equity in your home, you’ll receive a check for that amount. If you’re buying another home, your profit will make a valuable down payment.
Selling homes with a mortgage is a common practice done every day. If you want to move from your current residence, don’t let your mortgage hold you back. Find out what you owe, make a plan for covering it, and decide on your next step.