Need to know how to get out of a mortgage? If you just got a new job offer, discovered that your wife is having a baby or were informed that your ARM is due to adjust, it may be time to get out of your mortgage. With the proper preparation, getting out of your undesirable mortgage isn’t as challenging as you may believe. There are numerous options available for you to consider to get out of a mortgage.
- Refinance the loan. Refinancing is your best bet to get out of a mortgage if you love the house but hate the loan. When you refinance, a new lender assumes your mortgage loan. This can often help you get a better interest rate and lower monthly payments. The best part of refinancing is that you can get out of a mortgage that no longer suits your needs and into a new one that does.
- Sell the house. If you do not owe more on your mortgage loan that the home is worth, selling your home is a surefire way to get out of a mortgage. When you sell your home, the buyer’s loan pays off your current mortgage. This leaves you free of the responsibility of making further mortgage payments.
- Transfer the loan. Some lenders allow homeowners to transfer their home loans to another individual. Either you or the individual you wish to transfer the home loan to will probably need to pay a transfer fee to your lender in order to complete the process. By agreeing to transfer your home, your buyer gets to assume your loan under the same terms you were originally awarded while you get out of the mortgage.
- Let the bank foreclose on the property. Although this certainly isn’t the most pleasant of options, it is still a viable option to get out of a mortgage. If you can’t make the payments, you can simply walk away and allow the bank to reclaim your home through foreclosure.
- Negotiate a short sale with the bank. If you have no equity in your home and worry about the possibility of foreclosure, you can negotiate a short sale with your lender to get out of a mortgage. In a short sale, the lender permits you to market your home for less than the amount you still owe to the bank. If the home sells for less, it is imperative that your lender agree to forgive the amount you still owe; otherwise you’ll be trapped paying a mortgage debt for a home you no longer have access to.