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Message
Getting Mortgage to Buy House before Selling Existing House
Posted on 5/16/15 at 8:16 am
Posted on 5/16/15 at 8:16 am
I am being transferred towards the end of summer/early fall. I want to buy a house where we will be moving so wife and kid can go there before school starts.
My credit union offers 10% down loans. However, they said since I would not be selling my existing home until after I bought another home, it would be a second home and I would need to put 20% down. If I do 20%, it will exhaust all savings and I like having a reserve (reserve would also be there to cover part of both mortgages if needed).
Any suggestions on where or how to pull this off? FWIW, I have about $50,000 to put down on purchase of second house and plan to roll proceeds from sale of house into new house and will refinance. TIA
My credit union offers 10% down loans. However, they said since I would not be selling my existing home until after I bought another home, it would be a second home and I would need to put 20% down. If I do 20%, it will exhaust all savings and I like having a reserve (reserve would also be there to cover part of both mortgages if needed).
Any suggestions on where or how to pull this off? FWIW, I have about $50,000 to put down on purchase of second house and plan to roll proceeds from sale of house into new house and will refinance. TIA
5
Posted on 5/16/15 at 8:28 am to WPBTiger
Why don't you rent until you sell house #1?
Posted on 5/16/15 at 8:30 am to lsufan1971
quote:
Why don't you rent until you sell house #1?
We have a couple of dogs and most places want a 1 year rental agreement. Also, we have already seen a couple of places we would be interested in putting in an offer.
This post was edited on 5/16/15 at 8:32 am
Posted on 5/16/15 at 10:03 am to WPBTiger
Rent an apartment that does short term leases
Posted on 5/16/15 at 10:54 am to WPBTiger
HELOC?
Not saying that is a good financial idea, we don't have enough info, but I think a HELOC would be the easiest answer here, assuming he has equity in his home.
Not saying that is a good financial idea, we don't have enough info, but I think a HELOC would be the easiest answer here, assuming he has equity in his home.
Posted on 5/16/15 at 12:13 pm to TheHiddenFlask
Yes, I have plenty of equity in the existing home. I have thought about a HELOC. Could someone explain to me what the payment would be on a $50,000 HELOC. Below is from CU website.
Also saw this on website regarding HELOC
quote:
Minimum Payment Requirements
You can obtain credit advances for 120 months (the draw period). During the draw period, payments will be due on a monthly basis and will be established and fixed at
the time of each advance (other than for any credit insurance premiums) at an amount equal to 1.00% of your then outstanding balance, subject to the lesser of $30 or
your account balance.
The rate is 2.99% for six months and then Prime Minus .50% or Minimum 4.00%
Also saw this on website regarding HELOC
quote:
Repayment Terms
Minimum payment is 1% of the outstanding balance.
This post was edited on 5/16/15 at 12:28 pm
Posted on 5/16/15 at 1:21 pm to WPBTiger
Not saying it's wrong, but why are you so in love with your CU?
Posted on 5/16/15 at 1:25 pm to iknowmorethanyou
quote:
Not saying it's wrong, but why are you so in love with your CU?
I am not, I have already reached out to another institution. Just trying to get some advice if they also come back with the 20% decision.
Posted on 5/16/15 at 1:50 pm to WPBTiger
IF you have lots of equity then talk to the bank about a BRIDGE loan-- this is the best way to go.
Credit union may not do this
Most private and local banks do this loan
where do you live?
Credit union may not do this
Most private and local banks do this loan
where do you live?
Posted on 5/16/15 at 1:52 pm to WPBTiger
Minimum monthly payment would be 1% of the balance, so $500.
Posted on 5/16/15 at 1:54 pm to 756
quote:
where do you live?
Florida, moving back to Louisiana.
Posted on 5/16/15 at 2:06 pm to WPBTiger
Your sig gif is very distracting.
This post was edited on 5/16/15 at 2:07 pm
Posted on 5/16/15 at 2:16 pm to WPBTiger
Get a bridge loan, then refinance after you sell your house,
Posted on 5/17/15 at 8:53 am to TigerintheNO
I'm going through the same thing right now. I did an FHA loan on the second home and all they required is a justification of why I had to purchase 2nd home before selling first home. I just wrote a letter explaining I was having to move closer to the office because I'm always on call and being called into work. They only required 3.5 down.got a really good rate as well 3.875
Posted on 5/17/15 at 9:11 am to AUtigR24
Use FHA 3.5% down. Crazy when people put 10-20% down and use all there savings
As long as you intend to move into the new prop and DTI works with both mortgage payments you are fine to buy as primary
As long as you intend to move into the new prop and DTI works with both mortgage payments you are fine to buy as primary
Posted on 5/17/15 at 10:11 am to AUtigR24
Who are you using to get the mortgage for the new house.
Posted on 5/17/15 at 10:14 am to SDVTiger
M
I take it this is a bank that I would have to go to?
quote:
Use FHA 3.5% down. Crazy when people put 10-20% down and use all there savings
I take it this is a bank that I would have to go to?
Posted on 5/17/15 at 12:54 pm to SDVTiger
quote:
Use FHA 3.5% down. Crazy when people put 10-20% down and use all there savings
I thought you can only get a loan under FHA if it is your first home (or have not been a homeowner for more than 10 years).
So it wouldn't apply here.
And FHA by choice is a hell of a lot less attractive now if you can put the money down due to PMI lasting the life of the loan.
This post was edited on 5/17/15 at 12:56 pm
Posted on 5/17/15 at 6:11 pm to Volvagia
The tags that have been added to FHA loans have made them completely unattractive.
Posted on 5/17/15 at 10:04 pm to TheHiddenFlask
I would not do FHA because of the upfront and annual mortgage insurance.
You can do a 2nd home with 5% down.
You can do a 2nd home with 5% down.
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