Real estate question

What's the price of the home? I'm an agent in Lafayette and most likely a seller won't take a contingency contract on a home under $300k getting a lot of showings. If it's sitting then they will definitely take a contingency.

The timelines can get very complicated on when to start spending money (inspections and appraisals) and when not to.

A seller will also want your home listed with an agent if they accept a contingency. I knew a really good realtor to refer in Marksville (they are hard to find in Marksville).

I'd be happy to give you the scoop on the home. I've worked w many people on TD before.

Your house is listed for $400k or the new house? Is your current house listed? If not, as said above you need to list your house before anyone would take a contingency.

Do you have the financial means to purchase the new home on its own and carry 2 mortgages between the time you close on the new house and close on your old house? That's a possibility depending on your monthly debt payments to monthly income, the banks will loan you money with a ratio of about 45%. If you have savings that would be the easiest way to do it.

There's no cheap way. Personally, I'd never take a contingency from a buyer unless I'm desperate. I'm not sure if be looking to buy a house from someone 'desperate' to sell unless it's a great financial move for yourself without any personal emotions involved.

If $400k then it should work. Sellers are desperate in that price range bc of so few buyers. I'll be happy to help. Email me at gumboboudin at yahoo .com

The first thing I'd do is go through "worst case scenarios".

1.) Contingency is not accepted. Are you bent on buying this particular house or planning to move no matter what?
2.) What if you list your house this week, get an offer, and it closes in 40 days; but house you are offering on does not appraise or pass inspection? Now you are "homeless", that ok? Worst case you rent for 6 months or something.
3.) Get two mortgages for 12 months and have to sell our current house for 10k less than we were hoping to get rid of 1 mortgage?

If you have good credit you can get a mortgage now with 5% down, sell your current house, and refinance once you sell your current place and have more money for a down payment.

How much equity will you realistically get after 6% realtor fees on your current house? Just trying to throw everything out there for you.

All good points. A contingency deal is one of the most complicated in real estate

just remember your lender orders the appraisal not you. Lenders have to order appraisal's other wise they cant use them for the loan and you will have to pay for 2 appraisals.

Why would you adjust sale price if agreed price is higher than appraisal? The appraisal is usually going to be lower than your agreed price, at least thats been my experience in miami. I cant speak for other cities, but the appraisal merely affects the amount you can qualify for on your loan. Condos in miami are constantly coming in at $400-500k appraisals and selling for $750k, you just have to come to the table with alot of cash bc banks will only loan money based off the appraisal.

The market has definitely cooled down in most of the US so you have time to do all that, you go back to two years ago in Houston and it was so hot, you literally had less than 24 hours in some cases to have everything ready to go and if you were financing and someone else was able to close quicker than you, you lost out. I say take your time, sell your current place and once you have a contract signed and a deposit thats passed its inspection period, then go shopping for a new home. You dont want the deal to fall apart and get stuck wtih 2 homes. Im sure you will find another dream home at that time. I don't know the earnest money you'd have to put down, but I bought a $520k condo close to what you are looking to buy 3 years ago and I had to give them $50,000 in earnest money the day I signed the papers. So think about your finances and if you have enough cash to handle your current home + earnest money on a new home. Dont forget fees, loan origination fees on a home at that price are going to be up there.

quote:

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1. agree on price sign contract
2. inspection
3. appraisal (ordered by lender)
4. adjust sales price if the appraised value is less than contract price

you don't want to spend money on an appraisal if the inspection comes back with major flaws and you decided to cxl the contract

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^This plus I noticed you expected to net 90k after paying 6%. I would say selling typically costs more along the lines of 8%. Your 90k net is probably a little too high.

To a degree that is good, I'd only take a contingency if I was in a desperate situation to sell.

Another option I've heard of is people paying rent to the seller of the house they want to buy until their house sells. Or something along those lines. You could even sign a 6 month lease or something.

Look, real estate is still the wild west in investing compared to the stock market. Its a local game, if you find a house you love at a price that seems great then I wouldn't be afraid to offer something along those terms to try until you sell your house. The worst they can say is no, and a lot of people (women) want to know the house they owned is going to someone that is going to "love it" like they do. They may even include part of your rent into the purchase price.