Basic approaches to selling a home with two mortgages
Homeowners in Florida carrying two mortgages still have the ability to sell as long as they pay off both loans at the conclusion of the transaction. For someone whose house has a value that meets or exceeds the loan balances, the process is largely similar to selling a home with a single mortgage. When the loan balances total more than a property’s value, then a homeowner might pursue the strategy of arranging a short sale.
A real estate agent may provide advice and services that help a person sell a home for a high enough price to pay off two loans. For example, an effective marketing strategy could connect someone with a buyer willing to pay the asking price or close to it. If this happens, a title company manages the funds at the closing and distributes the money to pay off both loans completely. If any money remains, then the seller gets to keep it.
An owner with a property that has insufficient value to satisfy two mortgages has the option to sell the home and then pay off remaining debts out of pocket. When this is not feasible, then the seller could attempt a short sale. To achieve this, the homeowner must convince one of the mortgage lenders to accept a lower amount than the loan balance. Before a lender agrees to a short sale, the seller needs to demonstrate financial hardship and justify moving to a different location.
A person who needs to use the short sale approach could gain advice from an attorney. Legal representation might help a person negotiate with a bank for terms that satisfy the client’s goals. An attorney could also evaluate the bank paperwork for a short sale to see if the person is gaining a clear release from further liability.