Do you know the best way to go about selling a home and buying a new one so that you wont get stuck with two mortgages?
Its best, where possible, to put your home on the market early enough so that you wont be caught in a two-mortgage situation. That way, should you sell your old home before you locate a new one, you can:
- Ask your buyer to settle on a mutually-convenient closing date that allows you more house-hunting time.
- If an earlier closing date is unavoidable, you might be able to sell, then rent your home back from your buyer until you find a new home.
- If your buyer must move in before you find a new home, you can rent a home in the area where youre house-hunting.
If, on the other hand, you must buy a new home before youve sold the old one, one of these interim methods may tide you over:
- If the seller of the home you want to buy agrees, you might be able to make your purchase contingent on selling your old home within a specified time. Under these not-ideal circumstances, the seller may agree only if the home can be kept on the market while waiting for you to sell yours. If the seller receives another offer during this waiting period, you may be given the opportunity to meet the new offer or bow out.
- If you have a purchase contract on your old home, but the closing date is some time off, you might take out a bridge (or swing) loan, using the equity in your old (and also, sometimes, in your new) home as collateral.
- If you have accepted a transfer offered by your employer, you may receive programmed relocation assistance, which will probably cover a portion of the costs of selling your old home and buying a new one (including a bridge loan of some sort). Your company may engage a third-party relocation management company to sell your old home.If, however, your company has no relocation program, it may still assist you with the financial aspects of your move.
Each selling/buying situation is unique. If you are uncertain about which steps to take, lets talk things over. Our experience can help you decide what to do, when and how.