Foreclosure in Huntington>Question Details

Carlos, Home Seller in Huntington, WV

Is there any way I can sell my mortgage to an Individual person, not to a bank?

Asked by Carlos, Huntington, WV Fri Jul 25, 2008

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Don's answer is spot on. You're probably not in the position to sell the mortgage, because you're on the other end of it - meaning you're the borrower.

IF, you're the holder of the note and the borrower is not paying the mortgage, that's an entirely different situation.
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0 votes Thank Flag Link Fri Jul 25, 2008
I think you're not quite using the right terminology. Specifically, you'd "sell" a mortgage if you'd been the owner, took back financing yourself, were holding the mortgage, then wanted to sell it for a lump sum, rathre than receive monthly payments. The answer then would be yes. It's done all the time.

However, noting that your question appears in the "Foreclosure" area. So I'm guessing you owe money to a bank. You have a mortgage. And you're trying to find a way out.

In that case, you wouldn't sell the mortgage to the bank. It's the bank's mortgage.

If it's similar to what Cori guessed, my response is a bit different than hers.

If you're considering having someone take over your mortgage payments, yes, that can be done. That's called a "subject to" transaction--they're buying your house "subject to" the existing financing. That means ownership would be transferred to the individual, but you would still be responsible for the mortgage. They'll promise that they will pay the mortgage...and they probably will. But you have to understand that, if they fail to, the bank will come after you, not them. The mortgage is still in your name.

Such a transaction violates the "due on sale" clause in your mortgage. But that's not against the law, and it's done frequently.

The other scenario Cori suggested was that the individual would be your new lender. That, too, is possible. But watch out for promises of a sale and leaseback with an option to repurchase. Some are legitimate; some are not. Most legitimate investors don't do that anymore. That involves someone approaching you and saying, "I'd like to buy your house. You can continue living in it. You'll make your payments to me. After a year, I'll sell the house back to you." A couple of questions: If you're having trouble paying your current mortgage, why will it be any easier when you're paying off a larger loan to someone else? And after a year or two, even if you do struggle by and make the payments on time, will you be financially able to repurchase your house? Probably not.

So, be careful.
0 votes Thank Flag Link Fri Jul 25, 2008
Don Tepper, Real Estate Pro in Fairfax, VA
MVP'08
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This is a very serious matter that you are getting yourself into; involve your attorney in the situation, as well as the lender (mortgagee) and their legal people. From this point, and their sound advice, your path should be clear. Mortgage situations usually involve much money, can be tricky and are nothing to fool with. Good legal advice here is worth every dime.
0 votes Thank Flag Link Fri Jul 25, 2008
Yes, it can be done, check with your (Real Estate) attorney to guide you, and to make sure it's done right. Please call me if you have any questions..cell# 631-889-2997
0 votes Thank Flag Link Fri Jul 25, 2008
Absolutely as long as they pay the note!
0 votes Thank Flag Link Fri Jul 25, 2008
Hi Carlos,

The answer depends what you are trying to do.

If you are trying to have them take over your mortgage payments. It can be done if your lender allows assumption of your mortgage. Your lender can tell you if your loan allows this.

If you are trying to have this individual be your new lender. This can be done by having them payoff your existing loan. You can then make payments to this individual instead of your bank.

Please fell free to call me directly if you have any questions,631-944-8829.

Cori Kaplan
0 votes Thank Flag Link Fri Jul 25, 2008
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