What happens if i sell a house that is worth 100 k more than when i bought it?

Question

hypothetically, say i bought a house for 200 k 2 years ago and am able to sell it for 300 k now. however, i only own 8 or 9 k of the house. how does this work? i dont' get to pocket 100 k do i?

Answer 1

You say you only own 8 or 9 k of the house.... do you owe $292K ????

Answer 2

You get to keep whatever is left over after closing fees.  Closing fees include: title insurance, termite clearance, realtor fees, mortgage balance, etc...

Answer 3

You own the full value of the house.  That value is offset by the amount of the mortgage.

You own: $300K worth of house

You owe the bank: $200,000 for the original mortgage less $9,000 you paid, for a total debt of $191,000.

When you sell the house for $300,000 and pay off the bank what you owe them ($191,000), you get to "pocket" $109,000 less any costs for selling the house, such as a Realtor's commission.

You will not be subject to capital gains taxes because you are under the threshold and you lived in the house for two years.

Answer 4

What do you mean you only "own 8 or 9 k of the house".  If you are saying you have a mortgage for 191K (of the 200K purchase price) then the mortgage is a debt you owe the bank but you still own the house completely and therefore you will keep all profits of the sale (of course you'll have to pay the bank their 191K plus fees and interest).  So, you pretty much to pocket the 100K, or whatever is left after all costs and the mortgage is paid.

Answer 5

talk to someone that is a professional... we are all going to give you the wrong answers lol  

Answer 6

As long as a full 24 months have passed you keep the profit, it is yours.

If you sell prior to 24 months you have to pay capital gains tax.

Answer 7

The bank will take what you owe them before you see your money, plus you also have to pay escrow fees.  One more thing if you do not invest the money (I believe that is within 2 years) you have to pay taxes as an income.  What I mean by invest is to buy another property; You might check with an accountant.  At least in CA that is the case.  Unless you are over 55 years old, then you don't have to pay for the $100.00.