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Do I need to tell my mortgage company if I sell my house?
Do I need to contact my mortgage company before I sell my house?
Asked By Rachel | Raleigh, NC | 1723 views | Selling | 1 year ago
Answer(3)
Jim Hocking
Keller Williams Grand Rapids North
Yes, you should inform your mortgage company when you decide to sell your house. It is important to communicate with your lender throughout the process for several reasons:
Paying off the mortgage: When you sell your home, the proceeds from the sale will typically be used to pay off the remaining balance on your mortgage. Your lender will provide a payoff statement, which outlines the exact amount required to settle the loan, including any accrued interest and fees.
Release of lien: Once the mortgage is paid off, the lender will release the lien on your property. This allows the title to be transferred to the new buyer free and clear of any encumbrances.
Escrow account: If you have an escrow account for property taxes and insurance premiums, your lender will need to close the account and disburse any remaining funds after the mortgage is paid off.
Prorated interest: Mortgage interest is typically paid in arrears, meaning that you pay interest for the previous month. Informing your lender about the sale allows them to calculate the prorated interest due up to the closing date of the transaction.
Documentation and coordination: Your lender may need to provide documentation, such as a mortgage statement or loan payoff letter, to the title company or closing attorney handling the transaction. Keeping them informed ensures a smoother closing process.
In summary, it is essential to notify your mortgage company when selling your home to ensure a seamless transaction and proper settlement of your loan. Your real estate agent and closing attorney can also help coordinate communication with your lender to facilitate a smooth home-selling experience.
- 1 year ago
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Tamika Graham
eXp Realty, LLC
Often good to let your mortgage company know if you are selling the home to provide a forwarding address for any refunds that may be due to you
- 1 year ago
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Chris Yochum
Dickson Realty
Its not typical to inform your mortgage company, though when selling your home it will generally be required to get a demand statement for the up to date payoff information which is in essence informing them that you are selling the home.
- 1 year ago
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