Financing in Madison>Question Details

Ginger, Home Buyer in Madison al 35757

IF a house is paid in full.... and you "refinance" to pay debt, when you sell are there penalities?

Asked by Ginger, Madison al 35757 Thu Aug 28, 2008

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I'm not a lender, but it's my understanding, that unless the "refinance" loan you take out has some sort of pre-payment penalty, you should be able to simply payoff that loan at closing.

It sounds as though your situation would be perfect for a home-equity line of credit (HELOC) to pay off any debt. And there's rarely a penalty for paying a HELOC off.
1 vote Thank Flag Link Thu Aug 28, 2008
Alan May, Real Estate Pro in 60201
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Read the terms carefully and make sure there is no prepayment penalty. It will be attacked to the note or deed of trust in your loan docs.

Also, I agree, get a HELOC, they work like a credit card. You even get checks. When you pay it off, it stays open to charge on it again and again if you need to pay off more debt later or do home improvements.
0 votes Thank Flag Link Sat Aug 30, 2008
Interesting question. I don't know the particulars, but I think you have faulty info.

Elvis has the answer I would give. Just pay it off at closing. (although Elvis has just left the building)

The person to ask is your lender.

But feel free to ask me other questions about Real Estate in Madison Wi
0 votes Thank Flag Link Thu Aug 28, 2008
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