Buying and selling a home can be a challenging process, especially when you’re trying to do both at the same time. It requires careful planning, coordination, and a team of experts who can assist you in navigating the process successfully.
Don’t know where to start? No problem. Let’s tackle the common concerns on how to buy and sell at the same time.
Do You Buy First or Sell First?
There are pros and cons to whether you buy first or sell first, but you should mainly consider your financial situation. If you have enough money to buy your new home without selling your current home, you may want to consider buying first.
This will allow you to move out of your current home before putting it on the market, making it easier to stage and show. Plus, you don’t need to worry about finding a new place quickly or paying for moving expenses twice. However, this could leave you on the hook for two mortgage payments for a few months.
Can I Sell My Home If I Still Have a Mortgage?
Yes—in fact, it’s very common. When you sell a home with a mortgage, you can use the proceeds from the sale to pay off your mortgage balance and any closing costs. You will be able to clear your debt as long as you sell your home for more than the outstanding balance.
When Should I Start Looking for My New Home?
It’s a good idea to browse the market before you put your current home on the market. You want to make sure that there are homes that meet your desired criteria before you sell your current home.
You shouldn’t put in an offer to buy a new home until your current home is under contract—unless you make your offer subject to your current home selling. Otherwise, you may be obligating yourself to own both homes at the same time.
What If I Can’t Find a New Home Quickly?
Once you get your home under contract, it can be a race to find a new home. This is why it’s important to have a general idea of what the buying market is before you get started. There are also a few things that can help you during this time.
You can negotiate for a longer closing from the buyers of your current home or ask for a rent-back from your buyers. A rent-back is when the home closes but you stay in the home and “rent it back” from the new owners for a time.
Another good option is to use PODS storage or similar instead of a moving truck in case you need to live somewhere in between temporarily. You don’t have to worry about moving your stuff twice.
How Do I Put an Offer on a House Before Selling My Current Home?
One way to put an offer on a new house before selling yours is to include a contingency clause in your offer. This contingency states that your offer is contingent on the sale of your current home. You can also consider getting a bridge loan, which is a short-term loan that can help cover the down payment and closing costs for your new home while you sell your current home.
How Can I Ensure My Home Will Sell?
You should work with an experienced real estate agent to ensure your home sells quickly and for the best possible price. Your agent can provide you with tips on how to stage your home, price it correctly, and market it effectively. Also, make sure you have a professional inspect your home for any repairs that need to be made before putting it on the market.
What If One Sale Fails?
Things can get very tricky if one sale fails to go through. If the buyers of your home fail to purchase, you could be left paying two mortgages. And if the home you want to buy doesn’t pan out, you could be left with nowhere to live!
One possible way to mitigate this is to write the offer subject to the other home closing. That way, if one fails, you’re not obligated to move forward. Keep in mind that this could limit your choices of homes as it creates an unknown for the other parties and not every seller is willing to take an offer for their home subject to the sale of another.
Can I Close On Both Homes at the Same Time?
Yes! Ideally, everything will work out so that you can sign for both sales at the same time. You would complete the sale of your current home and the purchase of your new home together.
This is definitely possible and happens all the time. However, it does require a lot of careful planning and a team of experts who can help make sure everything goes off without a hitch.
How Do I Know How Much Money I’ll Make/How Much I Can Afford?
One of the most important things you can do before you start this entire process is to consult with a real estate professional and a mortgage professional. This will give you a clear understanding of how much money you stand to make from your home sale at different price points, as well as how much your new mortgage will be based on how much you want to put down. This is a critical step and should be done at the very beginning.
Need Some Guidance?
When it comes to selling and buying a home at the same time, there are many complexities. Every homeowner's situation is unique, and the decisions you need to make will depend on the state of the market, your financial and personal circumstances, and the timeframe that accommodates your needs. And if you’re not sure how to proceed, don’t hesitate to reach out.
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