Purchasing a new home can be a complicated process, but buying and selling a home simultaneously can be downright nerve-racking. There are many components involved in the purchase and the sale of a home, and when doing both at the same time, it is important to work with a real estate professional and mortgage lender who can answer your questions and help you through the transition.
Your real estate professional will be fundamental in helping research home prices in your area and assisting you with the appraisal process of your current home. This initial step will assist you with listing your home at a price that strikes the balance between making a profit and getting the property sold in a timely manner. Your real estate agent will also be able to provide you with a market analysis so you can get an idea of how long it may take your home to sell.
Whether you choose to sell your current home first or buy a new home first, you will be presented with challenges. If you decide to sell your home before you close on a new home, you will have the expense of temporary lodging and storage. An experienced real estate professional may be able to add a rent-back clause to your sales contract wherein the new owner agrees to let you rent the home for 60-90 days after closing, often in exchange for a lower sales price.
If you decide to purchase a new home before selling your current home, you won’t have the proceeds from your home’s sale to assist with a down payment. This could also mean paying two mortgages concurrently, which may make it harder to qualify for a new home loan. This is why it is vital to work with an experience lender who can provide you with options. An initial meeting with a loan officer will give you information on loan programs, like Bridge Loans, which are specifically designed to provide short-term financing for situations where borrowers are selling and purchasing a home at the same time.
Buying and selling homes simultaneously will typically present challenges. Planning ahead and working with a reputable real estate agent and experienced mortgage professional will assist you in tackling those challenges and obtaining your dream home.