April 9th, 2014
Simultaneously buying and selling a home can be a daunting task. Closing for both houses on the same day would be ideal, for it provides a seamless transition, but more often than not, the timing of buying and selling homes tend to not work out so perfectly. Grand View Builders understands that successful house hunting that requires buying and selling properties simultaneously is an extremely busy time. Our years of experience working with buyers and sellers have lent us useful insight into this situation so many homebuyers and sellers find themselves in.
Families who are buying and selling a homes simultaneously often find themselves in one of these situations: temporarily not owning a home if you sell your current house before you are able to purchase another or owning two houses at the same time if you purchase a new home before you have sold your current house.
If selling a home before you’ve bought a home is the scenario you find yourself in, you have a couple of options.
- In short-term situations, it’s popular for the new homeowners to rent back their home to you. A contract will need to be drawn up stating the length of the rental period (normally 30 days) and the renter is responsible for covering certain fees. In most cases, renters will be asked to pay the price of the mortgage, homeowners insurance, property taxes and utilities.
- If you’ve sold your home and suspect it’ll be more than a month before moving into a new house, you should consider moving in with loved ones. If that isn’t an option, a short leased apartment or extended-stay hotel are both popular options for temporary housing.
If you buy your new home without selling your old one first, you’ll find yourself doubling up on many costs, including a mortgage, if your old house isn’t paid off, as well as insurance and utility bills. Below are some loan options available to help deal with the extra financial duties, if cash is not readily available.
- Tapping into your home equity is the best way to get a down payment for the new house if you do not have the cash flow available. The interest rate for a home equity line of credit is based on your credit score and the interest is tax deductible up to $100,000.
- A bridge loan is a viable option if tapping into the equity of your home is not possible. This loan allows you to borrow money for a down payment on the new home. The loan amount will be dependent upon the amount of equity you have in your first house.
The Grand View team wishes you the best of luck during the purchase and selling of your homes! For those still on the lookout for the perfect house be sure to take a look at our communities today!