Selling our house? - Mothering Forums

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#1 of 7 Old 04-27-2006, 11:29 AM - Thread Starter
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I have a question about selling our house.

We have a buyer already which is great. What I am wondering is that when the contract finally gets signed and we have 6 weeks to move, do we still pay our mortgage payment? I am wondering because we could really use the 900.00 that month instead of it mostly going to interest?
As in, will Bank of America be fine knowing that they are about to get paid off or do they still try to get every last penny out of you?
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#2 of 7 Old 04-27-2006, 02:09 PM
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I may be wrong, but won't you and the finance company get all of your money at the closing? Meaning you will no longer *have* a mortgage, b/c it will be paid in full. Then you get however many weeks after the closing to move out.
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#3 of 7 Old 04-27-2006, 03:51 PM
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Free Thinker is right. When the contract is signed, you will get the money from the buyer and pay off the mortgage. The bank will calculate the interest you owe up to the day and come up with a "payoff balance." Once the mortgage is paid, even if you are living there, you don't make a payment 'cause it's not your house.

You may either have an escrow shortage and need to pay some or have a nice surprise of a refund of what they have been holding in escrow (for taxes and insurance). Most likely you'll have money in escrow coming to you.

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#4 of 7 Old 04-27-2006, 04:28 PM
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I agree with the others but wonder if you'll be expected to rent back from the new owners? A few years ago when we were selling we thought we might need to stay there a few weeks past the closing date and at one point we considered renting back from the people we had just sold to.
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#5 of 7 Old 04-27-2006, 06:52 PM
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Well, I think it depends on exactly when you are talking about. Are you talking about signing the contract in which your buyers agree to purchase the house, or are you talking about the actual closing?

We signed our contract to sell our house about 2 weeks before the closing. We were responsible for payments up until the closing date.

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#6 of 7 Old 04-27-2006, 09:06 PM - Thread Starter
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I guess I should get clearer about the details.

I imagine that the new owners will want to close before their rental time is totally up as they will want time to move in.

They need the house by July 1st and perhaps we'll close a few weeks before that. I guess the bank will calculate the amount up to that point. Perhaps we'll get a free week or two here.

It doesn't matter so much; we are just trying to build at the same time and every penny counts.

Closings usually take about 6 weeks or something right?
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#7 of 7 Old 04-28-2006, 09:48 PM
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I work in real estate, this is how it usually works:

You negotiate for the house, generally if you are going through an agent, the buyer will sign an offer and put down earnest money (aka deposit) which they will lose if they back out of the contract. After you reach mutual acceptance, you sign a purchase and sale agreement. How this is done differs in various states. Some states have standard forms which combine offer and P&S, others the offer is different and you don't sign the purchase and sale until after other inspections are done. A lawyer can draw up a purchase & sale for you.

Generally at some point the buyer does a home inspection on the house, this is because of what htey call 'caveat emptor' which means buyer beware - the buyer has the responsibility to find anything wrong with the house that is 'discoverable' themselves. In general the buyer can't come back and sue the seller if they find something after closing, only in cases where the buyer had no way to discover the problem themselves (called a 'latent defect') AND they can prove the seller did know about the problem.

At the time you sign the purchase and sale you pick a closing date. This date could be tomorrow, it just depends on the terms of the contract, if the contract has a clause stating the buyer needs to obtain financing, then most likely the closing date will have to be at least 4 or more weeks out in order for the loan to get underwritten in time. Generally the seller pays all costs of maintaining hte house, their own mortgage up until closing, buyer pays all costs thereafter. Generally a closing agent makes sure that all the costs add up and everything is prorated and the money goes to the right person. (For example if you've paid the taxes for the year and are selling halfway through the year, then the buyer owes you the taxes for hte half of the year they own the house).

At the closing, title (or ownership) passes on that property. At the point when the buyer receives the deed to the property, you no longer own it. So you do not have the right to occupy it unless you have worked this out in advance with the buyer and have a written contract to that effect.

According the Statue of Frauds in order to be enforceable all real estate agreements MUST be in writing. This means that no verbal contract will be recognized by the court, so if you agree verbally with the buyer that you can stay on the premises another 3 weeks but do not have that in writing, you will not have a leg to stand on in court.

While if you have a buyer already you do not need a real estate agent, you definitely do not want to go through a real estate transaction without a lawyer representing you. The buyer should have one too, but of course you may or may not care if the buyer ends up with a bum deal... The lawyer can act as or get you in touch with an appropriate closing agent, help you secure title insurance, make sure you are paying applicable taxes, etc etc.

Oh the short answer - Yes, bank of america will want every cent for every days interest up until the day they get paid off.

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