What happens if I sell my property before paying off my mortgage?

When you sell a property before paying off your mortgage, the mortgage must generally be paid off as part of the sales transaction. When a property is sold, the proceeds from the sale are typically used to pay off the remaining mortgage balance first. This ensures that the lender receives the amount owed to them before any money is distributed to the seller. It is important to know the specific details of your mortgage agreement. Most mortgages include a clause that allows for the loan to be paid off at any time, but there may be prepayment penalties depending on your lender and the terms of your loan. Therefore, it is advisable to consult with your mortgage lender to understand any potential penalties that may apply. After paying off the mortgage, you will receive the remaining funds from the sale. If the selling price of the property is higher than your mortgage balance, you stand to gain a profit from the transaction. However, if the selling price is lower than the mortgage balance, you may face a situation known as a short sale, where the lender must approve the sale for less than what is owed. In any case, it is always a good idea to consult with a real estate professional or a financial advisor to navigate this process smoothly. For detailed information regarding mortgages and potential tax implications, your best resource would be trusted financial advisors or the current web page of a relevant service.