Are you planning to sell your house in Norman, Oklahoma? Mortgage not paid off yet? Wondering if you can sell a home that you still owe money on?
Actually, selling a home with an ongoing mortgage is more common than you think. The Zillow Group Consumer Housing Trends Report for 2021 reveals that most mortgages are taken out for a 30-year term. On the contrary, the average homeowner lives in their home for 14 years before selling it.
As you can see from this data, most sellers have a mortgage on their property when they go to sell it. So, if you wish to sell a house fast in Norman, OK, one that has an ongoing mortgage, you’re not alone. In this guide, we’ll walk you through all you need to know about selling a house with an ongoing mortgage.
Quick Points To Know About Selling A House With A Mortgage
- The proceeds from the house sale go to paying off the balance on the existing mortgage, and the lender receives the payout at the time the deal is closed.
- Once you have paid off the remaining mortgage debt and covered all additional selling costs, like agent commissions and closing fees, the rest goes in your pockets. Hopefully, you will have made a profit from the sale.
- If the amount raised from the sale falls short of what you need to pay off the mortgage, you’ll have to pay the rest from your savings.
- If you owe more than the cost of your home, then your situation is referred to as “underwater”. Your mortgage is likely to go underwater when you fall behind on mortgage payments or if you sell during a market downturn.
How To Sell Your Norman House With A Mortgage
If you’re ready to sell your Norman house, make sure you follow these steps so you know how to take care of the mortgage that’s attached to it.
Check How Much Your Home Is Worth
Start by getting a ballpark figure of how much your home is worth. You can use an online home value estimator or check how much similarly-sized homes in your neighborhood sold for. You can check with real estate agents to get a more precise number. Use the Comparative Market Analysis (CMA) tool to get an accurate idea of how much your home is worth.
Connect With Your Lender
The next step is to determine how much you owe to the lender. Connect with your bank and request a payoff statement. The payoff statement will show how much you owe to the lender until you repay the loan in full. Once you sell the house, your escrow company will work with the lender to get an updated payoff amount. Again, the proceeds from the sale are used to pay off the debt, hopefully in its entirety.
Calculate The Net Proceeds
The net proceeds is what you walk away with after paying off the mortgage and other selling costs. Here’s how you can calculate this value:
- Start with the approximate sale value of your home.
- Subtract the mortgage payoff.
- Subtract the agent commission (usually around 5% to 6% of the sale price).
- Subtract the closing costs (an additional 3% to 4% of the sale price).
The value you arrive at is the estimated net sale proceeds. Calculating this value will help you decide how much in profit you’re likely to make from the sale. This value will also help you budget for your new home accordingly.
It’s Time To Sell Your Home To make the entire sale proceed flawless, you need to find a great real estate agent or a cash home buyer in Norman, OK. As leading cash home buyers in Norman and Oklahoma City, we can help you quickly sell your home without any hassles. We partner with the best escrow companies, and we’ll help you close your mortgage without any hassles. Connect with us today to sell your house quickly and for a fair price, even if you have a mortgage on it.