Can you sell a house with a mortgage in Maryland?

Yes, you can sell a house with a mortgage in Maryland. In most cases, your existing loan is paid off at closing using the buyer’s proceeds, and you receive the remaining equity after fees and costs are settled.

Selling a Home With a Mortgage in Maryland: What You Need to Know

If you're planning to Sell Home in Maryland but still have an active mortgage, you're not alone. Most homeowners who sell a home in Maryland still owe money on their loan. The good news? The process is common, legal, and straightforward when handled correctly.

At the Frank Oliver Collective at eXp Realty, Michael Frank works with Maryland homeowners every year who need to sell before their mortgage is paid off. Whether you live in Bethesda, Columbia, Baltimore, Annapolis, or Silver Spring, the process follows similar steps — but local market conditions matter.

How Selling a Home With a Mortgage Actually Works

When you sell your home, your mortgage doesn’t transfer to the buyer. Instead, it gets paid off during closing.

1.     Here’s the typical process:

2.     You request a payoff statement from your lender.

3.     Your home goes under contract with a buyer.

4.     At closing, the title company uses the buyer’s funds to pay off your mortgage balance.

5.     Any remaining equity goes to you after closing costs and fees.

Maryland is an attorney and title company settlement state. That means a licensed settlement company handles payoff verification, lien searches, and proper disbursement — helping ensure compliance with RESPA regulations.

Maryland Market Conditions That Affect Your Sale

Understanding local conditions is critical when you sell a home in Maryland.

·       As of early 2026, the median home price in Maryland is approximately $420,000, though Montgomery County averages higher.

·       In Bethesda and Rockville, median prices often exceed $700,000 due to proximity to Washington, D.C.

·       Homes in Columbia and parts of Anne Arundel County typically average between $450,000 and $550,000.

Inventory levels in many Maryland counties remain below historical norms. This can benefit sellers with equity, especially in competitive areas like Silver Spring and Annapolis.

How Much Equity Do You Need?

Equity is the difference between your home’s market value and what you owe on your mortgage.

For example: If your Maryland home is worth $500,000 and you owe $320,000, you have $180,000 in equity before costs. After real estate commissions, transfer taxes, and closing costs, you’ll receive the remaining balance.

Michael Frank provides detailed net sheets so you understand exactly what you’ll walk away with before listing.

What If You Owe More Than Your Home Is Worth?

If your mortgage balance exceeds your home’s value, this is called being underwater. Options may include a short sale or negotiating with your lender.

Short sales require lender approval and must follow strict federal and state guidelines. You should consult your lender and a qualified tax or legal professional for advice specific to your situation.

Typical Costs When You Sell a Home in Maryland

Expense

Typical Range

Real Estate Commission

Varies (negotiable under current NAR guidelines)

Maryland Transfer Tax

0.5% state + possible county tax

Recordation Tax (if applicable)

Varies by county

Title & Settlement Fees

$1,000–$2,500 estimated range

Commission structures are fully negotiable and must comply with federal antitrust laws and current NAR settlement policies.

Can You Sell and Buy House Maryland at the Same Time?

Many homeowners who sell a home in Maryland also plan to Buy House Maryland shortly after.

Options include contingent offers, rent-back agreements, or bridge financing. The right strategy depends on your equity position and the competitiveness of your local market.

In competitive areas like Howard County and Montgomery County, preparation is key. Pre-approval, timing, and negotiation strategy matter.

Legal and Ethical Considerations

All home sales must comply with the Fair Housing Act and Maryland real estate regulations. Sellers must provide required disclosures, including property condition disclosures or disclaimers.

Michael Frank and the Frank Oliver Collective at eXp Realty adhere to the NAR Code of Ethics and Maryland Real Estate Commission advertising policies.

For legal, tax, or financial advice, consult licensed professionals.

Why Work With Michael Frank in Maryland?

Michael Frank focuses on data-driven pricing, clear communication, and strategic marketing. His experience across Maryland markets — from waterfront homes in Annapolis to suburban properties in Columbia — helps sellers make informed decisions.

Clients consistently note responsiveness, transparency, and local expertise as key strengths.

Next Steps If You’re Ready to Sell

If you're thinking about selling a home in Maryland but still have a mortgage, start with a clear plan.

Request a personalized home valuation and net sheet from Michael Frank at the Frank Oliver Collective at eXp Realty. You’ll understand your equity, your timeline, and your options.

Contact Michael Frank today to discuss how to sell your home confidently in Maryland.