It can seem like a daunting task to list, sell and buy a home. How do you even start the process? Many people who already own a home and are looking to upsize or downsize. Sometimes, financially it’s not possible to manage two mortgages. So how can it be done? Should you sell first and then buy? Or buy first and then sell? Or keep your home as a rental and buy another?
The answers to those questions are not black and white. Each person’s unique situation will determine the best course of action. That’s where we can help.
Selling first makes getting a mortgage much easier, but it also means you’ll need to find a temporary place to live. Buying first means moving will be easier, but it also skews your debt-to-income ratio, making it harder to qualify for a new mortgage—not to mention the difficulty of juggling two monthly house payments for a period of time. If your finances allow, sometimes renting out your current home and then buying another could be a great way to grow your nest egg.
The keys to success when selling your home and buying another, are Planning and Flexibility. A concurrent closing is possible, but should only be handled by experienced professionals. Have a Plan A, a Plan B and a Plan C. Gather all the information you need to make good decisions before you jump into anything contractual.
Often, moving up to a New Construction home is the easiest option because it gives you more time to sell your current home depending on the stage of construction. Many builders will also be more flexible on a contingent contract. Negotiation and proper contract preparation is key.