Buying your next home brings with it new challenges. How can you afford a new home when you still have the current mortgage? Should you buy the new home first or sell your current home first? What if you can’t find a home to move to once you have an offer on your current home that you want to accept. The good news is that there are solutions for all of these concerns.

Buy First Or Sell First

The advantage of buying first is that you know exactly where you will be moving to. You can move your things and turn over your first home as agreed. Moving can be in stages. You can time it so you can clean the home before turning over the keys. Depending on what you are buying, you can use the overlapping homeownership to paint the new place to your choice of colors. And/or replace or upgrade flooring and do other things to suit your needs.

The advantage of selling first is that you know exactly how much you are selling for and can budget accordingly. You can take your time finding your new home. It’s possible you will move into interim housing while still looking for or negotiating on your new home.

Bridge loans

For those who can afford two mortgages, there are bridge loans so you can buy a new home while still having the mortgage on your current home. Because this is a temporary situation, a lender can accommodate this need…at a higher than market interest rate. Though your monthly payment will be high, it is only long enough to find a buyer for the old home and close that escrow.

Negotiating Delivery

If the idea of two mortgages is too much, there are alternatives. You can let your buyer know that you need to rent back the home for 30/60/90 days while you find your new home. Or you can simply agree that close of escrow will be delayed by that number of days. Once you find the new home, you coordinate the close of the new escrow with the close of the old escrow. If less than the number of days agreed upon, the escrow company will accommodate you. If you need more time and the buyer does not want to wait, you will either have to find interim housing or cancel your agreement to sell to that particular buyer.

When buying your next home (either a bigger home or down-sizing), there are many solutions that will meet your needs. To explore these and other alternatives, contact me at 619 356 0815 or