Right now is the optimal time to sell a home. The housing market is experiencing record low-interest rates, and home values are soaring.
Many homeowners are gaining equity at a more rapid pace, and they may be looking to access that equity to move. Even if you still have many years on your mortgage, do you have the option of selling your home in this seller’s market? Some homeowners take out a 30 or 15-year mortgage and intend to stay in that home forever and pay it off. However, according to Forbes, most mortgages are paid off before the mortgage comes to term due to the sale of a home.
If this sounds familiar to you, we can walk you through the process.
How Does a Mortgage Work?
A house is expensive, so most people use a mortgage loan to pay for it. The bank fronts the cash for the home, and then the homeowner pays a monthly mortgage that includes principal and interest payments. Over the course of the mortgage term (usually 15 or 30 years), your monthly mortgage payments decrease, and you’ll eventually pay off the mortgage loan—meaning you own your home officially.
Selling a Home with a Mortgage
Most of the homes on the market have a current mortgage; this means the seller is looking to use the sale of the home to pay off the remaining mortgage total, as well as provide a down payment for their next home. When you sell your home, you’ll use the money for the following:
- Paying off your mortgage
- Paying off any fees, HELOC (Home Equity Lines of Credit), outstanding property taxes, etc.
- Paying closing costs and sales purchases such as commission, taxes, titles, appraisals, inspections, and more
- Funding a downpayment for your next home purchase
The process is relatively smooth for most homeowners who still owe on their home. They’re able to sell a home for more than they owe, complete their mortgage, and take some money for their next real estate transaction.
Short Sales & Foreclosures
Two uncommon but important types of home sales with existing mortgages are short sales and foreclosures. When you’re in financial trouble and unable to make your mortgage payments, you may find yourself facing a short sale or a foreclosure.
Short Sale: A short sale is when you sell your home for less than what you owe on a mortgage. Many homeowners usually take this step to prevent foreclosure. Homeowners need to work with their bank to accept or work out a settlement on the difference between the short sale value and the amount owed on the mortgage.
Foreclosure: The bank repossesses your home and puts it up for auction, leaving you responsible for the outstanding difference if it sells for less than the amount owed. Foreclosure is devastating to your credit and future ability to attain a mortgage.
Sell Your Home Now with Fast Oklahoma House Buyers
If you’re a resident of Oklahoma County or Tulsa, Oklahoma, whose eager to sell a home in this market but don’t know where to start, call Fast Oklahoma House Buyers. We can help you sell your home, pay off your mortgage, and move on to your next adventure.