Can I sell my home if I still have a mortgage?
Yes! Many homeowners sell their property before their mortgage is fully paid off. The outstanding mortgage is generally paid out from the sale proceeds through your lawyer at closing. Depending on your mortgage terms, you may face a prepayment penalty or discharge fee. Some lenders also offer mortgage portability options if you're purchasing another property. I recommend contacting your lender before listing so you understand your payout amount, potential penalties, and how much equity you can expect to have available after the sale.

Selling With a Mortgage at a Glance


  • You can sell your home even if you still have a mortgage.
  • Your lawyer pays off the mortgage from the sale proceeds.
  • Prepayment penalties or discharge fees may apply.
  • Some mortgages can be ported to a new home.

How the Payout Works


Your lawyer requests a payout statement from your lender, uses the sale proceeds to pay off the mortgage, and arranges for the mortgage to be discharged from the title.


Prepayment Penalties


Breaking a mortgage before the end of its term can result in a penalty. Variable-rate penalties are often three months' interest, while fixed-rate penalties may be higher.


Porting Your Mortgage


Some mortgages can be transferred to a new home, which may help you avoid penalties and keep your interest rate. Porting rules vary by lender.


Estimating Your Equity


Your equity is your sale price minus your mortgage balance, penalties, commission, legal fees, and other costs.


Using Your Equity


Your equity can help fund your next down payment and closing costs. If you're buying before your sale closes, your lender may be able to provide bridge financing so your equity is available when you need it.


Talk to Your Lender Early


I recommend contacting your lender before listing so you understand your payout, penalties, and options. I can then help estimate your expected proceeds.