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Started By
Message
Buying a new home before selling my current one
Posted on 9/23/15 at 8:50 pm
Posted on 9/23/15 at 8:50 pm
A home has fallen into our laps as of today for a price slightly above what I would like to spend and about 5 years before I had ever planned on moving in the first place.
However, probably about 6-8 homes have sold in my subdivision within the last five years and they all sold very fast (within about two months). Three of them even sold within a few weeks of being on the market and those were either smaller and not as nice or very comparable to ours.
Because all of the homes for sale in my two-street subdivision have sold so fast in the last five years, I'm willing to risk buying this new home before selling my own. I just have never done this before and need to know how easy it would be to get a lender to give us a mortgage at a good interest rate BEFORE selling our current home.
Combined income: $82,000
Only debt: current home ~$970/month before escrow
Credit scores: mine is 770 and hers is about 750
Will use the profits from sale of current home to chip away from our new loan. Profits would likely be somewhere around $21,000 IF we don't use a realtor to sell our current one. This would leave us five years "behind" on a mortgage payoff plan and add about $10,000 to the total amount owed.
How possible is it going to be to get a lender to loan us the money to purchase the new home before we sell our current one?
Edit: We can afford to pay probably three mortgages of similar monthly notes each month. We have no monthly debt except for our home.
Also, how willing are realtors to only charge 3 or 4% if we go with one?
However, probably about 6-8 homes have sold in my subdivision within the last five years and they all sold very fast (within about two months). Three of them even sold within a few weeks of being on the market and those were either smaller and not as nice or very comparable to ours.
Because all of the homes for sale in my two-street subdivision have sold so fast in the last five years, I'm willing to risk buying this new home before selling my own. I just have never done this before and need to know how easy it would be to get a lender to give us a mortgage at a good interest rate BEFORE selling our current home.
Combined income: $82,000
Only debt: current home ~$970/month before escrow
Credit scores: mine is 770 and hers is about 750
Will use the profits from sale of current home to chip away from our new loan. Profits would likely be somewhere around $21,000 IF we don't use a realtor to sell our current one. This would leave us five years "behind" on a mortgage payoff plan and add about $10,000 to the total amount owed.
How possible is it going to be to get a lender to loan us the money to purchase the new home before we sell our current one?
Edit: We can afford to pay probably three mortgages of similar monthly notes each month. We have no monthly debt except for our home.
Also, how willing are realtors to only charge 3 or 4% if we go with one?
This post was edited on 9/23/15 at 8:53 pm
7
Posted on 9/23/15 at 9:01 pm to TDsngumbo
What's the new mortgage payment? Do you have 20% down for the new house? What's your plan if your current house takes two years to sell?
Posted on 9/23/15 at 9:09 pm to TDsngumbo
Just know that just because the other homes sold quickly doesn't mean yours will. I just did this and got a bridge based on my homes equity to get down payment for next home. Original home in nice neighborhood, good schools and all, houses selling quickly.
Luckily I was well prepared because mine didn't sell quickly and 4 months later finally got an offer and took 20000 less than what I wanted.
Better make sure you can handle the worst case scenario.
Luckily I was well prepared because mine didn't sell quickly and 4 months later finally got an offer and took 20000 less than what I wanted.
Better make sure you can handle the worst case scenario.
Posted on 9/23/15 at 9:27 pm to TDsngumbo
If your Debt to Income is less than 45% with both homes, you should easily qualify for financing given your credit score.
Eta: you could get under contract with a contingency. Just act fast in getting your place in the market.
Eta: you could get under contract with a contingency. Just act fast in getting your place in the market.
This post was edited on 9/23/15 at 9:29 pm
Posted on 9/24/15 at 6:05 am to TDsngumbo
quote:
for a price slightly above what I would like to spend and about 5 years before I had ever planned on moving in the first place.
That sounds like you know the answer...
Posted on 9/24/15 at 9:41 am to TDsngumbo
IDK where you live but summer of 2014, we fell into the same type situation. Super nice house, priced WAY fairly but were concerned about selling our home as we're in a SMALL town. We put in an offer with a contingency of selling our home and they gave us 6 months. We took a week to clean/spruce/fix things and then put the sign in the yard. We did use the realtor who my husband had contacted about the home we were purchasing to sell our house.
It didn't take 2 weeks ... I'm STILL shocked at how quickly it happened. It was at that point that we started the financing on the new home.
It didn't take 2 weeks ... I'm STILL shocked at how quickly it happened. It was at that point that we started the financing on the new home.
Posted on 9/24/15 at 11:44 am to TDsngumbo
quote:
about 5 years before I had ever planned on moving in the first place.
This is the most concerning part. Are you ready for this new house? i.e. if it's more expensive, location, etc.
When you say the house has fallen into your laps...is this someone you know? Would they accept a 6 month contingency? Is it on the market already? Are they in a hurry to move?
Similar situation happened to my SIL (no pics). Had a house in one town, and was looking to move to a second town, since they were commuting to the second town for work everyday. Someone knew someone who wanted to sell a house they were only living in part-time. Wasn't in a big rush to sell, and didn't want to deal with putting it on the market. The price he was asking of the house was insanely fair. So they put an offer on it with a 6 month contingency, thinking that would give them PLENTY of time. Her house took 5 months to sell. By the time the financing was all straightened out, they had to ask for a week extension to close on the new house, which was granted.
Posted on 9/24/15 at 6:03 pm to LSUFanHouston
where do you live?
we moved within DFW last year and our house sold within 3 hours. had 8 showings the first day and 2nd couple that looked offered 5k over asking
all my friends are in similar boat. if you're in a good market then F it
Austin is the same way
we moved within DFW last year and our house sold within 3 hours. had 8 showings the first day and 2nd couple that looked offered 5k over asking
all my friends are in similar boat. if you're in a good market then F it
Austin is the same way
Posted on 9/25/15 at 8:41 pm to theoldwiseone33
Prairieville/Gonzales area
Posted on 9/25/15 at 8:51 pm to TDsngumbo
FYI, the house I had trouble selling was in Pville.
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