AN EXPLANATION OF SOME OF THE COSTS YOU MAY INCUR WHEN
YOU SELL YOUR HOME
Paying off the existing first mortgage... The interest costs on
your mortgage are adjusted from the date of your last payrnent to the date of
closing. Also, check with your mortgage holder to determine if there is a
prepayment penalty for prepaying your mortgage (there are no prepayment
penalties on either VA or FHA mortgages.)
Other financing oustanding on your property...
Home improvement loans, second mortgages, contracts for deed, mechanic's
liens, tax liens or judgments...all of these may need to be paid at the time
of closing.
Contract for deed discounts... If you sell your
home and part of the buyer's payment to you is in the form of a contract for
deed, the contract can be sold by you to third parties, but only at a discount
(less than the face value). This rate fluctuates with the money market.