Planning to sell your house and buy another? If this is the case, what will you do first? In case your top priority is to sell, you will be pressured to find another home immediately. This can end up staying in a hotel where you need to pay expensive fees, stuffing yourself and your belongings in one room until you purchase a new place to live.
However, if you want to buy first, you need to move immediately to sell your old home. This means that you need also to get enough money from your old home for the down payment of the new one. Of course, owning two homes at a time is not a practical idea. You need also to worry two mortgages, double the maintenance, and the security issues leaving the other house empty.
To avoid problems, here are several ways to reduce psychological and financial downsides of selling your home and also buying another.
• Catch the Temperature of the Housing Market
Before making any move, like putting the property on the market or purchasing a new home, why not investigate the home prices in the area which you plan to sell and buy? To figure out, how to sell the property in high price and buy at a lower price, you need a realistic idea on home prices.
Also, focus on the local real estate market. Identify the hot and cold market. Because you are both a seller and a buyer, protect yourself from the weaker role and make the most of the stronger role.
• Strategies in the Buyer’s Market
Take note that when the market is cold, it is an advantage for the buyer and not to a seller. There are lots of houses to pick at a reasonable price. But the negative side is that you find it hard to sell your home. To protect you, begin buying a second home. However, speak to the seller to make a purchase contract on the selling of your present home.
• Strategies in the Seller's Market
When the market is hot, selling homes is easier than buying. To be sure you don’t end up homeless, begin searching for a home to buy. After that, save some cash to surge you on the presumably short time which you own two homes at a time.
How to Own Two Houses Temporarily
What if you can’t perfectly assimilate the sale of the other house along with the purchase of a new one? You may end up homeless and have cash in the bank and you need a temporary place to reside. Or another thinking is to own two homes at a time. The suggestions below could help you deal with these bubbling acts;
- Borrow cash from family and friends for the down payment of the second home
Ask them that you need financial help for a short period of time and you will give an affordable interest rate. Give a promissory note to the person whom you borrowed cash that is secured by the second mortgage on your new home.
Make an arrangement to avoid late payments until the first house is sold. Be warned that some institutional mortgage lenders refuse to approve the loan when the home down payment does not come from your own funds.
- Acquire a bridge loan from a lending company
If you have no choice, it is possible to borrow money from the lending company or perhaps bank to bridge the gap between closing the deal on your new home and when get cash from the sale of that old one. The money you borrowed can be used for the closing costs and down payment of your new home and you can repay it after selling your first home.
By digesting the tips, selling your old home and buying another one cannot be a problem anymore!