Everyone knows how intimidating it is to be a first-time home buyer, but unfortunately experience doesn’t make your second time around any easier. In fact, becoming a repeat buyer can actually be more complicated. Since most of us aren’t rich enough to carry two mortgages at once, the only option may be to somehow manage to buy the second house immediately after you sell your first one. Talk about a balancing act!
If you find yourself in the precarious situation of having to buy and sell a home at the same time, you’re not alone. Here are some tips to help you along the way.
Your first step is to create a strategy based on the current housing market in the area of the home you’re selling as well as the one in which you’re looking to buy. Take whatever steps necessary to increase your current home’s marketability, which means making any needed repairs and improving its curb appeal. Meet with a realtor or appraiser to determine the best list price for your home, so as to make a profit while also selling it in a timely manner. Do not limit your purchase options! Find several available homes within your price range that meet most (if not all) of your criteria. This will be particularly helpful in the event your first choice doesn’t work out for whatever reason.
Arm yourself for the unexpected
Since there are many moving parts involved in selling and buying homes simultaneously – many of them being out of your control – be prepared for things not to go exactly according to plan. For instance, it may be a good idea to line up a temporary place to live if you sell your home before you are able to find a home to purchase, or in case the closing of the home you are purchasing cannot take place immediately following your sale. Discuss the likelihood of a rent-back agreement with your purchasers in advance. This would allow you to continue living in your current home for a maximum of 60 to 90 days while paying rent to the new owners. The important thing is not to let fear and anxiety push you into purchasing a home that you aren’t crazy about just for the sake of having a roof over your head once you sell your current home.
Conversely, it would limit your stress tremendously if you were financially equipped to temporarily handle two mortgage payments, since there is the possibility that your sale will fall through while your purchase moves along without a hitch.
While it’s never easy to buy and sell at the same time, with some careful planning and guidance you’ll successfully navigate the process without losing your mind. For further guidance, visit the Cliffco Mortgage Bankers Know-How Center or speak with one of our home loan experts at (516) 408-7300.