When you sell a house with a mortgage in Ogden – Whether you’ve just bought a house or have lived in it for years, you likely have a mortgage or home loan. A mortgage is a loan against the value of your home. The power of leverage allows you to be the owner of a bigger house than you could otherwise afford. But what happens when you sell? If you aren’t careful, closing costs and paying off the loan at closing can eat up most or all of your profit! This article tells you what to expect after the sale of your property and how to make sure you get paid the right price.
When you sell a house in Ogden, the last thing you want to do is to get caught off guard at the closing table by an unexpected home sale profit. Having a rough estimate of your home sale profit ahead of time can be the difference between celebrating your good fortune or leaving the closing table disappointed. The best way is to contact the lender via phone/email and get an estimate about the payoff amount. That will be different from the remaining loan balance mentioned on your monthly mortgage statement because it includes interest rates.
What’s Your Equity in the House?
Equity is your share in the property, the amount you can borrow if you want a home equity loan. For example, you made a down payment at the time of purchase. That counts in your equity. In addition, you have paid some mortgage loan (excluding interest rate), and you might have made some improvements to the property. Those improvements add to your original investment in the house.
Sometimes, you see a gain in your home equity because of market conditions. For example, let’s say the purchase value of your home was $200k, but now it’s valued at $500k. That’s an automatic increase in your home equity, but you won’t see the actual value until your home sells.
So, What Happens When You Sell Your Home?
We’ve all heard that buying a home is when the most money is made (or lost). But what happens after you seal the deal? When you sell a house in Ogden, the buyer pays off your mortgage and covers closing costs, homeowner association dues, and any outstanding debts you may have incurred. Those funds get transferred to your mortgage lender and anyone else who has a claim against it. After everything is paid off, there is usually a profit left over. That profit is yours to keep.
What If I Don’t Have Equity in the House?
Home prices have taken a hit in some areas, and values are nowhere equal to the original prices. If that’s the case, or you have borrowed from your equity and don’t have sufficient balance to cover the expenses…, then there are a few solutions.
You can go with a short sale so that the lender will accept the offered amount for the property. Unfortunately, that option doesn’t always work. Lenders don’t take this option unless it’s the last way to recover their money. A better option is to go with a cash sale. That will help you eliminate agent commissions and closing costs which can run in thousands. If you cannot pay closing costs, then a cash sale will solve the problem for you. We buy houses in Utah for a fair cash price. If you want us to work with you, we would love to help. We can even negotiate a short sale with your lender if needed. And we can buy your home fast for a fair cash price. Please click here to join us for a free consultation.