Many of us wonder if there’s a way to go about getting paid off from our mortgage. We all know that getting paid off a mortgage is not a piece of cake. You would be amazed at how few people actually get paid off from their mortgages! The truth is that most people are never paid off. This may surprise you since you’re probably thinking that lenders would like to see a regular stream of income coming in so they can feel comfortable lending to you; however, that’s rarely the case.
The truth is that lenders don’t want to give you any more money until you prove that you can pay it back. This means you need to prioritize your debts and figure out which loan to pay off first. For example, if you have high interest credit card debt, your mortgage loan may not be paid off as fast as you think. In fact, it may take years.
If you’ve decided to sell your home, your mortgage company will most likely want to know how you are planning to do that. They don’t want you to move yet! So before you list your home for sale, be sure to include any paid off loans in with the price.
But even after you list, you might not get paid off. Your lender might agree to add the loan payments to the total amount due, but they may not be able to tack on any interest. There are a few things you can do. Here they are.
First, contact all of your lenders and ask them if they will waive or reduce the loan balance if you pay it off in full. Some lenders will give you a loan extension, which may extend the term of the loan. You can use the money from the loan extension for whatever you need. While you’re negotiating with your lenders, you may also want to negotiate a payment arrangement or other payment terms with your tax professional.
If you have difficulty getting your lender to waive or reduce the loan balance, you may want to consider selling your home before you list it. A short sale will give you a better price and help you avoid foreclosure. Once your lender agrees to a short sale, your mortgage note may become constructive, which allows you to transfer ownership of the property to another party without triggering the foreclosure process. If your lender agrees, you’ll have paid off your loan and avoided the hassle of foreclosure.
For some lenders, there might be additional benefits to letting you sell your home rather than converting it to a mortgage. They might agree to allow you to keep the house as-is and not include the unpaid loan balance in the sales price. Your lender should be able to provide you with the paperwork you need. In this case, you might want to consider a short sale to avoid entering into a mortgage contract.
With foreclosures becoming more prevalent, there are more options for people with loans that aren’t being repaid. If you’ve been thinking about avoiding foreclosure, you may be able to renegotiate with your lender to get paid off your mortgage. You can also look into different loan programs to see which one would work best for you. You may find that one option is better than others for getting paid off your loan early. The sooner you take action, the better your financial outlook will look.
Another option to consider when it comes to paying off your loan is to try to negotiate some type of payment arrangement with your lender. For example, you can consider getting the late fees dropped from your loan or lowering the principle. Perhaps you can pay extra fees on a monthly basis so that you’re only responsible for the amount of the loan. With these types of arrangements, you can often lower your monthly payments and be out of debt a lot sooner.
Another option to consider is to sell the property and stay in the home until your lender pays off your loan. You can find buyers for houses all over the country, but the demand in certain areas may be lower than others. In a weak housing market, you may be able to find better deals. On the other hand, you can often pay more for a home when there are more properties available. This may be the best strategy for getting out of debt by selling your home fast.
The key to getting paid off your mortgage is negotiating with your lender. The interest rate will not drop substantially, unless you can convince your lender that you will be a better risk than someone with bad credit. If you have multiple loans, speak to the lending institutions about getting the late fees dropped from each loan and then work out a plan to pay them off together. You might even be surprised to learn that some lenders will help you if you have multiple mortgages that need to be paid off.