There are some situations where you may be able to sell off your property and still retain the mortgage. There are also situations where you may end up with more than one mortgage at a time. Obviously, this latter situation is one that you won’t want to endure for long, unless you’re a property investor.
Situation #1: Moving to a New Home
Right now, one of the most common—and frightening—phrases that people hear is “underwater mortgage”. This is a situation that arises when the balance on your mortgage is higher than the value of the property it’s written for and, of course, that means that the homeowner is in a bad situation. This makes some homeowners wonder if they could take their existing mortgage to a new property.
Generally, you cannot “move” a mortgage loan as your loan is secured by your real estate. However, if you’ve been a good customer, they may offer you a mortgage much like the one you have. In fact, because there were so many bad mortgages being written in the past, you may even qualify for something better than you have right now.
Situation #2: Lease to Own
This is one situation where you may be able to keep your mortgage and sell your home. Under this arrangement, a new tenant moves into the home and takes over the payments on your mortgage. In Louisiana, you may hear this arrangement referred to as a “bond for deed.”
Some people who make these arrangements do them at a profit and make a bit of money off of the tenant’s payments. Sometimes they simply have the tenant make the regular payments, however.
This is sometimes done by property investors as a way to balance having more than one mortgage and to still keep it affordable.
Situation #3: Short Sales
If your mortgage is underwater, you may be able to sell it off in a short sale, which is a sale of the home for less than the value of the sum left on the mortgage. This requires approval from the bank and will depend upon your situation. It will impact your credit, so be careful about taking on such an arrangement.
Most often, a new home will require a new mortgage. You can talk to the mortgage lenders at NOLA Lending to see if we can find you something very similar to what you have, however, or even something a bit better.