Are you thinking about selling your home in Orange County but still have a mortgage?
Many homeowners in Irvine and the surrounding areas wonder how selling a home with an existing mortgage works.
The good news is that selling a home with a mortgage is common, and with the right guidance, the process can be seamless.
In this post, The Monica Carr Real Estate Group will explain everything you need to know about selling a home with a mortgage in Orange County,
including how to navigate the process, calculate your proceeds, and work with your lender.

Can You Sell a Home with a Mortgage?

Yes, you can absolutely sell a home with a mortgage. Most homeowners sell their properties before they fully pay off their mortgage.
When you sell, the outstanding balance of your mortgage will be paid off using the proceeds from the sale. Any remaining funds after paying off the mortgage and other costs are your net proceeds.

Understanding Your Payoff Amount

Before listing your home, it's essential to understand your mortgage payoff amount.
This amount includes the remaining principal balance on your mortgage plus any interest that has accrued up until the sale date.
Contact your lender to get an exact payoff quote, which is different from the balance you see on your mortgage statement.

How the Home Sale Proceeds Work

When you sell your home, the proceeds from the sale will first be used to pay off your mortgage.
Here’s a quick breakdown of how the proceeds are typically distributed:

1. **Mortgage Payoff**: The first portion of the sale proceeds goes directly to paying off your existing mortgage.
2. **Agent Commissions**: Typically, real estate agent commissions are 5-6% of the sale price, split between the buyer’s and seller’s agents.
3. **Closing Costs**: Closing costs can range from 1-3% of the sale price and include fees such as escrow, title insurance, and other administrative expenses.
4. **Remaining Proceeds**: After all these costs are deducted, what’s left is your net proceeds, which is your profit from the sale.

How to Calculate Your Net Proceeds

Calculating your net proceeds is crucial for understanding how much money you’ll walk away with after selling your home.
Use a home sale calculator to estimate your sale price, subtract your mortgage payoff amount, agent commissions, and closing costs.
The Monica Carr Real Estate Group can help you with accurate estimates based on your home’s value and current Orange County market trends.

What If You Owe More Than Your Home Is Worth?

In some cases, homeowners may owe more on their mortgage than their home’s market value. This is known as being “underwater” or having negative equity.
If you find yourself in this situation, options such as a short sale or loan modification may be available.
The Monica Carr Real Estate Group can guide you through these options and connect you with professionals who can help you make the best decision for your financial situation.

Do You Need to Inform Your Lender?

Yes, it’s important to keep your lender in the loop throughout the selling process. When you accept an offer on your home, your real estate agent will coordinate with your lender
to ensure that your mortgage payoff is completed as part of the closing process.
If you're planning on paying off the loan early, check with your lender about any potential early repayment penalties.

Tips for Selling a Home with a Mortgage in Orange County

Here are a few tips to help ensure a smooth sale when you still have a mortgage on the property:

1. **Know Your Payoff Amount**: Get an accurate payoff quote from your lender before listing your home.
2. **Work with an Experienced Real Estate Agent**: The Monica Carr Real Estate Group has extensive experience helping sellers in Irvine and Orange County navigate the process of selling homes with mortgages.
3. **Price Your Home Accurately**: Pricing your home correctly is key to a successful sale. Work with your agent to understand the local market and set a competitive price.
4. **Prepare for Closing Costs**: Make sure you're aware of all the closing costs involved so there are no surprises at the closing table.

Why Choose The Monica Carr Real Estate Group?

Selling a home with a mortgage in Orange County requires expert guidance, and that’s where The Monica Carr Real Estate Group comes in.
With years of experience in the Irvine real estate market, we know the ins and outs of the home-selling process and will help you get the best possible outcome.
We’ll provide you with a personalized approach, ensuring all your questions are answered and you feel confident every step of the way.

Ready to Sell Your Home in Orange County?

If you're ready to sell your home in Irvine or anywhere in Orange County, contact The Monica Carr Real Estate Group today.
Our team of experienced real estate professionals is here to guide you through the entire process and help you achieve the best results, whether you still have a mortgage or not.