When selling a house, what would be better as far as getting the money back that was originally put down?
A) Pay the house off completely from the mortgage company (95K remaining), then sell
B) Sell house with $95K remaining?
About 5 years ago I bought my house for $150K. I have been making just normal monthly payments for the whole time and saving / investing what ever I have left over as far as savings go.
Since this will be my first home that I will be selling, I am currently looking into options as to what would be the best way to handle it.
Currently my two options are the ones listed above, this house would be sold to my parents for the exact price that I paid for it, so no profit would be made by me.
My very limited knowledge on the matter is 'Person A' sells the house, any outstanding debt to the mortgage company gets paid, what ever is left from the transaction is sent to the seller.
My second question is, at this point, going with Option B, would 150K-95K = $55K that comes back to me would that be all taxed on?
Or does it make more sense to pay the remaining balance on the house then to sell it? If I do go this route, does this mean the whole $150K would be taxable?