Q: If I sell my home for an amount that is less than what I currently owe on my loan, do I have to pay the difference at closing or can I take that difference and add it on to my new loan on the home that I am buying?
A: Most of the time, the seller would bring any shortfall (money from their own funds) to the closing, making up the difference. It is also common in today’s market, to not have the extra funds to bring to the table @ closing. In this case, others have applied for & gotten authorization to (from the bank) close on the property without paying the loan in full. This is called a ‘short sale’. There is a process to this & guidelines that have to be met. You can get more details from your agent. Also, I have not yet seen where a lender will allow you to transfer part of the debt (the amount you would be short) to another loan.