Selling house with a financed roof that has not been paid off yet

11 Replies

I've been playing with the idea of selling my house, and I'm sure this is a very basic question but I was not able to find any answers on the BP forum or on Google.

Last year I got a 10 year loan to finance a roof replacement on my house, and now I'm wondering if the remaining balance on that roof loan would prevent me from being able to sell the house until after the roof loan has been paid off? 

Would the buyer's title search company have an issue seeing that there is a roof loan in addition to the mortgage? Or could I still sell the house and pay off the roof loan separately?

Just to be clear, I have been making all my regular payments and there is no lien placed on the house, so it seems like there wouldn't be any issue with the title search. 

Thanks

The roof loan mtg will have to be paid off at closing, just like your first mtg....I Assume there is a lien/mtg on your house for the roof financing. 

Originally posted by @Wayne Brooks :

The roof loan mtg will have to be paid off at closing, just like your first mtg....I Assume there is a lien/mtg on your house for the roof financing. 

Ok I see, thank you for that clarification. I was initially under the impression that a lien was only placed on the house if payments were missed, I didn't know that the lien is placed automatically as a condition of the roof financing in the first place, but that does make more sense.


A quick look at their website is that its 'probably' tied to your house as a lien and would in fact need to be paid of at closing...but really you would have to look at the paperwork for the loan and see if it was structured that way with the property as collateral or if it was structured as an unsecured loan.

I have no personal experience with how that company does their lending.

Is there a particular reason you would not want to pay it off at closing? Do you suspect the sale price would not cover all mortgages?

Originally posted by @Rich Bultema :

A quick look at their website is that its 'probably' tied to your house as a lien and would in fact need to be paid of at closing...but really you would have to look at the paperwork for the loan and see if it was structured that way with the property as collateral or if it was structured as an unsecured loan.

I have no personal experience with how that company does their lending.

Is there a particular reason you would not want to pay it off at closing? Do you suspect the sale price would not cover all mortgages?

Thank you, I was actually less concerned about the sale price not covering all mortgages, and more concerned with the roof lien actually preventing a sale from being able to happen in the first place. 

My initial plan for this house was to keep it as a long term buy and hold rental once I move out, which is still likely going to be what I do with it in the future. But I also wanted to look into the option of selling, just so that I know that exit strategy is a possibility despite the roof lien


Originally posted by @Mitch Harold :

Thats a $23k roof you got there, pay that loan off and dont ever do that do that again.

Yeah the main reason it was so expensive is that there were 2 layers of asphalt shingles on top of the original 100 year old cedar shake shingles that needed to be ripped off. But you're absolutely right about paying it off early, I was planning on having the roof paid off in about 2 years if I don't end up selling the house it before then