Your dream home just came on the market, the price is right, and the interest rates are low; but you already own a home.
Q: Should you try to sell your house first or buy the new one and figure it out later?
A: This is a very common dilemma and different financial situations call for different solutions. There is really nothing to talk about if your dream home is out of your budget, so first make sure you and the seller can come to an agreement on purchase price. Once you have agreed upon a number, see if you would be allowed to put in a clause to buy their home on the condition that you sell yours first. If the home is amazing and set at a great price, chances are that the seller will refuse, especially if there are many people knocking on their door to buy it.
Q: So now you are under contract to buy one house and you still own your house, what now?
A: The smartest way to go about this is to hire a local Realtor, with a competitive marketing plan and pricing strategy to sell fast. If your home is in great shape and priced well, you shouldn’t have a problem selling and buying your homes simultaneously. Unfortunately, the best of both worlds is rare to come across, but the next suggested plan would be to rent your current home, so that you can continue making your mortgage payments without a problem.
It is important to consult with a mortgage broker to make sure your financial situation is in line with all scenarios. They will help you decide whether you can get a loan and still carry two homes or if you must sell to buy the new home. In that case, if you know you need a larger home, or need to downsize, the solution is to put your house on the market. Once you are under contract on your home, begin searching for a new home to move into. Worst case scenario, you can either rent back your house from the new homeowners for a certain period of time or you can lease a short term rental.
Juggling two homes is no walk in the park. Using a Realtor to help you sell your home and find a new one will help save you time, money, and aggravation, especially in these scenarios when you are in need of guidance and transaction management.
By: Michelle Wasserlauf
Realtor / Sales Associate