CAN YOU BUY AND SELL A HOME AT THE SAME TIME?

Wouldn’t it be great if you could buy a home, move your possessions out of your old home, settle in your new place, and then deal with a less stressful process of selling? In most cases buyers usually need the money from the sale of their current home to close the house they just purchased. If you sell or buy first all depends on the specific situation in your local real estate market. Imagine you sell first but you can’t find something you like in the neighborhood you want. There can be pros and cons to both selling first or buying first, so let’s look at both possibilities and some factors to consider.

Selling first

Pros:
– You know how much money you have to work with.
– It’s easier to get a mortgage.
Cons:
– You may have to rent while you look for a new home or keep some belongings in
storage.
Strategies:
– You can negotiate with the buyers a rent-back agreement to be able to remain in
your property for a maximum of 60 to 90 days in exchange for a lower selling
price or paying rent to the buyers.

 Buying first

Pros:
– You have plenty of time to move and get your home ready to sell.
Cons:
– It’s harder to qualify for a mortgage because you have a much higher debt to
income ratio.
– You could end up paying two mortgages at once.
Strategies:
– Ask for a closing date on the purchase a little further out.
– Buy a home with a condition that says the purchase is subject to the sale of your
existing home.

Ultimately, it comes down to your view of the market. You want to buy first, you have to be pretty confident you can sell. If you sell first don’t feel like you have to compromise on things that are important to you just because you need to find a home. Selling and buying a house simultaneously will be stressful—but carefully considering and planning for the risks and hurdles can mitigate the stress.No matter what you decide, make sure you have a detailed conversation with a mortgage broker and your realtor, so that you can truly understand your options and their related costs.

 

http://www.teamcolato.com | (602) 565-6366 |  oscar@teamcolato.com

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