0
If you sell your house for less than owed can that balance be applied to a new homes mortgage without credit damage?
No. Every home loan is secured by a Deed of Trust, which only the lender can release. So if you have a mortgage on the home you want to sell you have to satisfy the loan. This is primarily done by:
1)Paying the loan off on your own or with the sale proceeds
2)Negotitating with the lender for a "short sale" where a less-than-owed amount is accepted as satisfaction for the debt.
If option 2 is the way you need to go because of value loss in the home, the process is done with all lenders on the home (if there is more than one mortgage). The first mortgage company releases the Deed of Trust and forgives the deficiency balance upon settlement of the sale. NOTE: Second mortgages may have the right to pursue you for any deficiency in the payoff to them unless the debt is forgiven in writing as part of the short sale agreement.
The forgiven debt will be reported to the IRS and you will have to account for it in your taxes. The loan may be reported several ways on your credit, which will determine the short sales impact on your score. Any settled or short-sale mortgages will negatively impact your score. If the loan is NOT reported as short sold or settled, it may not affect your score but you may still be unable to purchase another house for some time. Most mortgage companies require a copy of the HUD-1 settlement statement from any recent home sales to verify that the sale amount matches the mortgage balance, which in the case of a short sale, it won't.
US- Mortgage Forgiveness Debt Relief Act of 2007
The amount of the forgiven debt for the deficiency on a primary residence is also forgiven for federal tax purposes. There may be state taxes owed. You can read more about it at the related link below.
What else can I help you with?
Can you pay Bank of America mortgage with credit card?
Bank Of America does not allow payments towards mortgage balance to be applied from a credit card, only a checking account. Cash advance from a credit card can be obtained and then transferred to a checking account which is being used for the mortgage payment.
Can a high credit card balance prevent you from getting a mortgage?
Your debt is always taken into account. If your income can handle the credit debt and the mortgage there should be no problem. High credit card balances do not mean bad credit. Late or no payments make bad credit. Your better off with a high balance on a credit card that you pay regularly than no credit at all.
Is a line of credit mortgage bad for your credit score?
A line of credit is not bad by it self. It would be the balance of the line of credit that might raise some questions.
How can one apply for mortgage refinance with bad credit?
There are few points that help someone to make investors think of giving mortgage to the person with bad credit, if one is: Always pay minimum balance on time. Try to reduce balances. Don't run up the entire balance. Throw away new credit card offers. Fix credit mistakes.
How does obtaining a Home Equity Line of Credit (HELOC) impact Private Mortgage Insurance (PMI) on a mortgage?
Obtaining a Home Equity Line of Credit (HELOC) can impact Private Mortgage Insurance (PMI) on a mortgage by potentially allowing you to eliminate the need for PMI if you use the HELOC to reduce your mortgage balance below the required threshold for PMI.
Can you pay Bank of America mortgage with credit card?
Bank Of America does not allow payments towards mortgage balance to be applied from a credit card, only a checking account. Cash advance from a credit card can be obtained and then transferred to a checking account which is being used for the mortgage payment.
Is mortgage payable debit or credit?
Mortgage payable is liability for business and like all liabilities it also has credit balance and shown in liability side of balance sheet.
Where will you put mortgage payable on a general ledger?
credit mortgage payable in the liability side of the balance sheet
Can a high credit card balance prevent you from getting a mortgage?
Your debt is always taken into account. If your income can handle the credit debt and the mortgage there should be no problem. High credit card balances do not mean bad credit. Late or no payments make bad credit. Your better off with a high balance on a credit card that you pay regularly than no credit at all.
Is a line of credit mortgage bad for your credit score?
A line of credit is not bad by it self. It would be the balance of the line of credit that might raise some questions.
What do you called on the excess in credit balance?
You answered your own question. Any payment applied over the amount due is simply called a credit balance.
How can one apply for mortgage refinance with bad credit?
There are few points that help someone to make investors think of giving mortgage to the person with bad credit, if one is: Always pay minimum balance on time. Try to reduce balances. Don't run up the entire balance. Throw away new credit card offers. Fix credit mistakes.
How does obtaining a Home Equity Line of Credit (HELOC) impact Private Mortgage Insurance (PMI) on a mortgage?
Obtaining a Home Equity Line of Credit (HELOC) can impact Private Mortgage Insurance (PMI) on a mortgage by potentially allowing you to eliminate the need for PMI if you use the HELOC to reduce your mortgage balance below the required threshold for PMI.
What is an off set mortgage?
Also known as a flexible mortgage, an off set mortgage allows the amount of interest owed to be reduced by offsetting a credit balance. Offset mortgages are commonly used in the UK.
How can you get the best mortgage rates?
Have pristine credit. The better your credit history is, the lower your mortgage rate will be. The worst things you can do to your credit, in the eyes of a mortgage company: 1) Not pay your bills. This is absolutely the worst thing. 2) Not use credit at all. If you never use credit, the mortgage company can't determine how you act when you do. 3) Not carry a balance. If you get a credit card, make small purchases and always pay them in full at the end of the month, mortgage companies consider that not using credit. 4) Having way too much available credit. If you have many credit cards, the mortgage company will assume you might actually use all that credit. If you DO use it all, you won't be able to pay your house payment.
Can a bank attach a unpaid balance to real estate?
Not in Texas. If the unpaid balance is related to your Mortgage then the answer is yes. In this case your home will be foreclosed. an unpaid balance will eventually be reported to the credit bureau.
Can you transfer a balance from someone else's credit card?
No, you cannot transfer a balance from someone else's credit card without their permission.
