Buying and moving into a new home is one of life’s great experiences, especially if you’re buying your first home. From getting that pre-approval to the “yes!” response on an offer to closing and moving in, every step is exciting. And while the process is engaging and fun, it’s important to prepare for moving day […]
4 tips for buying and selling a home at the same time
Looking to upgrade your home for your growing family? Or maybe you’re an empty nester wanting to downsize. Whatever the case may be, buying a new home can be stressful enough without adding on the sale of your current one.
To reduce stress and help you through the process, the agents at SmartMortgage.com, along with your real estate agent, are with you every step of the way. Here are four tips to keep in mind:
Understand if you can carry two mortgages at once
There’s a good chance that you may buy a new home before being able to sell the one you’re in. If that’s the case, you’ll have to carry two mortgages at once. Your lender will see if you qualify to pay on two properties. Fortunately, there are ways you can do this, such as saving as much as possible before buying, and using a bridge loan.
Consult your real estate agent about sales contingencies
Sales contingencies can be an option when buying and selling a home at the same time. This contingency means that the sale of your home is contingent on finding another. Before using this method, consult your real estate agent. Buyers may be put off by this contingency because in their eyes, there’s little guarantee that the sale will go through.
As with any contingency clause, do your research and consult with your agent about which contingency you can safely include.
Consult your lender about a bridge loan*
As we discussed in a previous blog, bridge loans are short-term loans used when financing is needed but not yet available, like moving into a new home before the old one is sold. A bridge loan can also help sellers avoid the use of a sales contingency.
Have a back-up plan
If you do sell your home before you’re able to complete a purchase, it’s a good idea to have a back-up plan of where you’ll stay (and where you will store your belongings) in the meantime. Planning for this scenario in advance can help with the stress off.
*New first lien must be completed with Guild on new home purchase. Bridge Loan must be repaid within 6 months of closing and departing residence must be listed for sale. Not eligible in TX. Second liens not eligible in ME.The above information is for educational purposes only. All information, loan programs and interest rates are subject to change without notice. All loans subject to underwriter approval. Terms and conditions apply. Always consult an accountant or tax advisor for full eligibility requirements on tax deduction.