As a seller, you can find yourself facing the situation of wanting to sell your mortgaged house. Of first it can seem a problem, but the solutions are several. It should be borne in mind that each case has its own needs, in this post we will detail the different circumstances that you may have to face and we will analyze them.
First, you have two options: sell above the amount of the mortgage or sell below.
Sell above the amount of the mortgage
Imagine that you have 200,000 euros of debt at the time of selling. Your home may have increased in value and you may sell it above the price for which you purchased it. In that case, at the time of signing the deed, you can settle your mortgage.
How? When you find yourself in front of the notary along with the buyer, part of the check will go to the bank, the amount corresponding to the amount you have to pay for the mortgage.
Many think that this happens a few times, but the sector is in full swing, so the value of your home may have been changing. There are several online tools, which in less than a minute can give you an estimate of the price of the house. But if you want to know if the price has gone up or down compared to what you paid, and be able to put the sale price, you will have to ask for a real estate appraisal from a professional.
Sell apartment below the mortgage
There are other cases in which it is not possible to sell over the mortgage, and you are faced with the situation that if you sell you will have to assume a non-mortgage debt.
Subrogation of the mortgage
There is another option known as subrogate the mortgage. It is about changing the name of the owner, that is, the buyer happens to take over your mortgage. It is as if you sell the apartment without cancelling the mortgage since the buyer replaces you as a debtor. Even so, the bank with which you have contracted the mortgage has to agree with the operation. The profile of the new owner may not conform to the conditions of the bank and, consequently, the bank does not accept the transaction. This is a method that offers an advantage to the buyer, and that is saving the expenses from hiring a new mortgage. In addition, when subrogating a mortgage does not apply the Stamp Duty Tax that is between 0.5% and 1.5% on the amount of the loan, according to the autonomous community. Having a mortgage when wanting to sell the apartment, involves procedures that have to be done before a notary. For that reason, we recommend the advice of professionals as they accompany the entire process and understand your needs.