What happens if I sell my house for less than I ow e on the mortgage?
The only way to do this is through a short sale. There are 2 ways to execute a short sale, the traditional way is to have the lender agree to the purchase offer and agree to take less then the full amount owed on the loan in order to close out the loan and release the lien from the property. The only other way is for you to pay the difference from the amount that is offer and what is owed.
In order to find out if your lender is willing to do a short sale you must contact the lender and get them to send you their "short sale package" this is the paperwork you will be required to complete and submit in order to find out if the lender will entertain a short sale on the home. There are many things that factor into a lenders decision. The main one being the current condition and value of the home as related to what is owed to the lender as well as your reason for requesting it( aka- the hardship letter you need to write explaining the events that caused you to make this request). This process takes anywhere from 30-120 days typically, variance in time is based on the lender and their current volume in process.