Mortgage
A loan used to buy a home, secured by the home itself. If the borrower stops paying, the lender can foreclose. The word is often used for the full loan setup, including the note and the security instrument.
Get the steps of a home sale by email, in order, one short email at a time.
Eight short emails, free. Unsubscribe any time. What's in them
Where this comes up in a sale, and what follows
Part 1 of 4
Why a seller cares
Your mortgage is the biggest line on your closing statement, and its payoff is what stands between the sale price and your proceeds. Ordering a payoff figure early is the first step toward knowing your number.
Part 2 of 4
A simple example
Sale price $300,000, mortgage payoff $205,000, agent fees and closing costs about $20,000. Roughly $75,000 comes to you.
| The line | On a $300,000 sale |
|---|---|
| Sale price | $300,000 |
| Mortgage payoff, with interest to the day | About $205,000 |
| Fees and costs | About $20,000, depending on agent fees |
| Your proceeds | About $75,000 |
The mortgage is paid first, from the buyer's money, before anything reaches you.
Part 3 of 4
What people get wrong
That the balance on your statement is your payoff. The payoff adds interest to the closing date and any fees, and it is usually a little higher.
Part 4 of 4 · where to read next
Where it appears in the sale
What a definition is, and what it isn't
Keighbor is a software company, not a law firm, brokerage, or tax adviser. This is general information, not legal, tax, financial, or real estate advice about your sale. Your situation may differ. Before acting on a contract, disclosure, title, tax, or pricing question, ask an appropriately licensed professional in your state.
Written and researched by Keighbor Research · drawn from the reference glossary · how we research and check what we publish
In your Room, this word explains itself where it appears.
Your Room defines mortgage in the step you meet it in, beside the document or the date it belongs to. Free to set up, with an agent or on your own.
Organize my saleFree to set up. Pay once when you list: $89 or $189. 7-day refund.