Life can throw you curveballs and force you to move. Or, maybe you’ve grown bored with life and want to head down a new path. You might be hesitant to sell with a mortgage, wondering, “What happens to my mortgage when I sell my house?”
Selling despite having a mortgage is not only possible but common. You could end up making a profit or owing money, depending on the situation. Sell Pittsburgh Now is here to help you when you start searching “How to sell my house fast in Pittsburgh.”
Selling in Pittsburgh When You Have a Mortgage
What happens to my mortgage when I sell my house? It’s a great question, and what happens will vary based on the type of sale and how much money you owe.
Traditional Sale
When you sell a house traditionally, the money you earn from the sale will be used to cover the mortgage payoff, closing costs, and home equity loans. After selling the home, the rest is yours to keep.
Short Sale
A short sale happens when your home won’t earn enough money to cover the mortgage. Talk with your mortgage lender about how to proceed with the sale, as you may need to pay out of pocket to cover the rest of your mortgage.
Should You Sell If You Have a Mortgage in Pittsburgh?
Whether you should sell or not is a decision to make with your mortgage lender or a trusted accountant. Selling with a mortgage is doable and you should be able to do it without any problems if your home sells for enough. But, there are potential downsides you may run into:
- Reduced Credit Score: You’ll need a short sale if your home sale won’t be able to cover the cost of the mortgage, which may result in a hit to your credit score. Short sales show that you couldn’t pay your mortgage, making your score dip, and you may have difficulty buying a new house.
- No Equity: People typically sell homes to make money off the equity, but having a mortgage means you may not have much equity to work with. This means you won’t have as much take-home cash after the sale.
- Paying More Money: If you owe money after selling, it’s like you paid to sell your house. Sometimes you don’t have a choice, but is tough financially.
- Penalties: Some mortgage lenders charge a prepayment penalty that you have to pay if you sell your home before paying your mortgage. Ask about this before you start the selling process.
Sell Pittsburgh Now Can Help You Save Money
“What happens to my mortgage when I sell my house?” It’s a question that often brings up more questions. Mortgages can be tricky from start to finish.
If you want to simplify the selling process, your local cash homebuyer in Pittsburgh, Sell Pittsburgh Now, is just a phone call away. Reach us at (412) 275-5238 to get a cash offer for your home. We’re happy to answer any questions you have about the selling process.