Howard Hanna Real Estate
Howard Hanna Real Estate
Berta J. Smith, Howard Hanna Real EstatePhone: (315) 559-3316
Email: [email protected]

Selling This Home, Buying That One: Tips for Handling Financial Overlaps

by Berta J. Smith 03/22/2020

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Image by StartupStockPhotos from Pixabay

Unless you're a first-time home shopper, you'll need to acquire your next home while selling your current home. How do buyers finesse this?

When buyers are competing with each other for a tight inventory of available homes, the ones who are ready to come to the table fastest, not the ones with contingencies, are most likely to succeed.

So, what's an ordinary buyer to do? Here are the top solutions—not all for the faint of heart!

  • The collaboration: Ask the buyer of your current home to go ahead to closing, but let you rent it for a month or two past then. If the buyer really wants your place and is in the position to do it, your problem is solved. Obviously, this arrangement isn't for all buyers. But every situation is unique, and this might work for yours.
  • The photo finish: Plan to schedule simultaneous closings on both homes, if a motivated, approved buyer can agree to wait for you to complete your purchase. It's been done. There is some risk here, not to mention moving van challenges! If your buyer has to pull out for any reason, you may still have to close on your new home. 
  • The bridge loan solution: With a bridge loan, you can purchase a home before selling, borrowing against your current home equity until you have the sale proceeds in hand. These are meant to be short loans. A bridge loan will get pricey if your home takes longer than expected to close. Steer clear of depending on this kind of loan for more that the span of a few weeks.
  • The contingent offer: You can line up a new home without having to take on the new mortgage until you're done with your sale. Yet few sellers are happy to accept contingent offers and hold on until a buyer's home sells. Contingent offer agreements usually only stay open for about 60 days and often have clauses that can accelerate the buyer's need to commit, allowing the seller to accept another offer. 
  • The sell-and-hotel method: This is a good way to reduce risks. Sell your home, take stock of your bank account, and know exactly what you can comfortably purchase. Store any furnishings you plan to take with you, and get a short-term rental for yourself. This means moving twice, but it also means you have money from the sale, and you're not buried under two mortgages.

Selling one home to buy the next makes the already complex matter of home buying...more so. But an experienced real estate agent can lead along the best path for your circumstances and put you in touch with financial professionals where needed. 

About the Author
Author

Berta J. Smith

Roberta J. Smith CNY REALTOR ® - Quality & Service That Stands Out

About me:

• A full-time realtor since 2003

• Specializes in first time home buyers and estate sales

• Understanding the importance of detailed communication with clients

• Consistent Top Producer

• Associate Broker 

• Experienced negotiator

• Lifetime CNY Resident

I have great people skills, especially in a one-on-one atmosphere, and wanted to put those skills to good use. With a career in Real Estate, I am able to help people during one of the most important decision-making times of their life… buying or selling a home. I live with husband and have three children and four grandchildren. As a life-time resident of Central New York, I know my real estate territory very well and will provide the utmost service to my customers. I can tell you all about the school district, the economy of the area, established businesses, landmarks, where to shop and even where you can grab a great burger!

If you are looking to buy or sell a home in the CNY area, including Liverpool, Cicero, Clay, North Syracuse, Baldwinsville, Syracuse & other local markets, I am the agent to call.