Mortgage matters: Trading places--The art of timing your home sale and purchase
Sep. 3—Are you ready to take the exciting leap into a new home, but you're feeling nervous about selling your current residence first? Fear not! With the right strategy and some careful planning, you can confidently navigate the bridge between buying a new home while selling your existing one. Consider this article a guide, offering valuable insights and practical tips on how to success-fully manage this dual process. So buckle up and get ready for an upbeat journey toward securing your dream purchase while avoiding unnecessary stress or delays.
Buying a new home while selling your current residence might seem like a challenging tightrope act, but with careful planning and strategic maneuvers, many homeowners have achieved this balance. One option that many homeowners consider is obtaining a bridge loan. A bridge loan essentially provides the financial bridge between the purchase of your new property and the sale of your current one. While bridge loans can be great for some, they may not be the best solution for everyone. Talk with an experienced professional who can guide you through the details of this financial option.
Another possibility to consider involves negotiation — include a contingency with your offers to buy. One of the most common contingencies is upon making your offer to buy contingent or dependent upon the successful sale of your current property. For some homeowners preparing to buy and sell simultaneously, this is an excellent action plan to discuss with your realtor. A great realtor can let you know the pros and cons of this strategy, the current market for your home sale and the mindset of sellers in your price range. This approach could allow you to avoid juggling multiple mortgage payments. However, this method requires strong negotiation skills and thorough market research to ensure that your potential buyer and possible seller are comfortable moving forward with any uncertainty in the transaction. In competitive real estate markets and price ranges, it becomes crucial to strike the right balance between protecting yourself financially and positioning yourself as an attractive buyer amidst fierce competition.
One additional possibility to consider is called a post-closing occupancy agreement. This agreement is also referred to as a rent-back because the buyer will "rent back" the property to the seller for a defined amount of time and cost. This course of action can be a deal-maker for some sellers to finalize their new residence, complete a major life milestone or even have a little more time to pack while relocating for a new job. Some important points to prepare and review: agreement with all terms in writing to protect all parties, security deposit — perhaps even a percentage of the home sale in escrow, the right insurance policy for a rental situation. Working with your insurance agents, realtor and mortgage lender, this option can be an incredible option for some homebuyers to earn the deal and to give peace of mind and valuable time to the sellers.
Ultimately, successfully navigating the process of purchasing a new home while selling your current residence calls for resource-fulness and flexibility. Considering alternative financing options such as bridge loans, contingent offers or rent-backs can provide solutions during this transition period. Buying a home while selling your current residence may seem daunting, but with careful planning and the right mindset, it can be a smooth and rewarding experience. Explore your options, work closely with a knowledge-able real estate agent and stay excited throughout the process. Flexibility, open-mindedness and compromise can make all the difference.
Mortgage matters: Trading places: The art of timing your home sale and purchase
