Okay, so you’re staring at your mortgage statement and wondering: “Can I just sell this place back to the mortgage company and be done with it?” It’s not a weird question. In fact, it’s way more common than you think—especially when life throws financial curveballs like job loss, divorce, or even just the rising cost of groceries (seriously, have you seen egg prices lately?).
The Short Answer: Not Exactly
Let’s clear this up right away you can’t just sell your house back to the mortgage company like returning a toaster to Target. Mortgage companies don’t usually “buy back” homes. What you can do is explore a few real options that could relieve you from the financial weight of your mortgage.
Let’s talk about those options, because they might actually make more sense than you think.
1. A Regular Sale (Before Things Get Rough)
If you’re still current on your payments but just want out, selling your home the traditional way is usually your best bet. You can list it on the market, pay off your mortgage from the sale proceeds, and (if there’s equity left) maybe even walk away with some cash.
Just make sure you know what your home is worth. Tools like Zillow or Redfin can give you a ballpark idea, but a local real estate agent can offer the real deal.
2. Short Sale: When the House Isn’t Worth the Loan
If your mortgage is more than your house is worth yeah, that’s called being underwater you might consider a short sale.
In this case, you sell the home for less than what you owe, and the lender agrees to take that lower amount to release the lien. Sounds simple, but it’s not always a quick yes from the bank. They’ll want paperwork, explanations, and maybe a peek into your finances.
Still, many people have used short sales as a way to stop the financial bleeding and move on with their lives.
3. Deed in Lieu of Foreclosure: “Giving It Back”
This is the closest thing to “selling your house back to the mortgage company.” It’s called a deed in lieu of foreclosure and yes, it sounds like legal soup, but here’s what it means:
You hand over the deed to your home to the lender voluntarily, and in return, they forgive your mortgage debt (or at least most of it).
It’s not always accepted, and it can impact your credit, but it’s sometimes better than going through the long, painful process of foreclosure. It’s also not something you should try without talking to a housing counselor or attorney first.
A good starting point? Check out HUD-approved housing counselors. They’re free, helpful, and they won’t push you into anything shady.
4. Cash-for-Keys (Post-Foreclosure Option)
If your home is already in foreclosure or nearing it, the lender might offer something called cash for keys. It’s a deal where you agree to move out by a certain date, leave the home in decent shape, and in return, they give you a small cash incentive.
It’s not a win-win, but it’s also not a total loss. It can help with moving expenses or even a deposit on your next place.
Some Personal Real Talk
A neighbor of mine in Charlotte went through this last year. She lost her job, got behind on her mortgage, and felt like the walls were closing in. After months of stress and unopened mail, she reached out to her lender and asked about her options. She ended up doing a deed in lieu and while it was emotionally tough, she said the relief was “like breathing for the first time in a year.”
Sometimes the hardest part is making that first phone call.
Things to Watch Out For
Scams: If someone says they’ll “buy your home fast” or “negotiate with your lender” for a fee run. These scams are everywhere.
Credit Impact: Short sales, foreclosures, and deeds in lieu all affect your credit differently. Not forever, but it’s worth understanding what that hit looks like.
Tax Implications: In some cases, forgiven mortgage debt could be considered taxable income. (Yep, fun surprise from the IRS.) Definitely speak to a tax professional.
FAQs
Can I just walk away from my mortgage?
You can, but it’ll likely lead to foreclosure, serious credit damage, and possibly a lawsuit. Always talk to your lender first they may offer solutions.
Is a deed in lieu better than foreclosure?
Usually, yes. It’s faster, less damaging to your credit, and can sometimes come with relocation help.
Do I need a lawyer to do a short sale or deed in lieu?
It’s not required, but having a real estate attorney or experienced agent on your side is a very good idea.
Will the mortgage company pay me anything?
In some cases (like a deed in lieu or cash-for-keys), yes. But it’s not guaranteed.
Final Thought
So, can you sell your house back to the mortgage company? Not directly but there are ways to get out from under your mortgage if you’re feeling trapped. The key is to act early, know your options, and ask for help before it’s too late.
And hey, if you’re going through this right now you’re not alone. Many people have been exactly where you are, and they’ve found a path forward. You will too.