To payoff a mortgage within three years upon selling a house, prioritize calculating the sale proceeds after closing costs and compare them to the remaining mortgage balance. If the sale covers the payoff, allocate surplus funds to investments, debt reduction, or emergency savings. Accelerate mortgage payments pre-sale to reduce principal and consult a real estate agent to optimize listing timing for maximum equity.

The strategy hinges on aligning sale proceeds with mortgage obligations while maximizing net proceeds. Closing costs typically range from 2% to 5% of the sale price, averaging $12,000 for a $300,000 home (Federal Housing Finance Agency, 2023). Selling during a rising market can amplify equity, as home prices grew 15.4% year-over-year in Q2 2023 (U.S. Census Bureau). However, mortgage interest rates remain elevated (average 7.3% in Q3 2023, Federal Reserve), making prepaying debt advantageous to avoid future interest. A $200,000 mortgage at 7% over 30 years incurs $284,000 in total interest; paying it off in three years saves ~$50,000 (Bankrate calculator). Selling before rates drop could also prevent refinancing delays. Combining strategic pre-sale principal reduction with market timing ensures the mortgage is fully repaid while preserving financial flexibility.