Juggling Buying and Selling simultaneously has changed since the bubble
Lending practices have changed since the bubble burst making the logistics of buying and selling at the same time more challenging. In the past, banks would do equity loans for the down payment for the next home. Now, they are not only reluctant to do so but many of the homes still don’t have enough equity for such a loan.
The other factor that effects this juggling act is that today’s buyers want a house that is move-in ready. Therefore, your home will need to be freshened up and staged to show off its best characteristics.
First and foremost, know your finances.
- Contact a realtor to determine a value range for your current home. Also calculate the bottom line by knowing the standard closing costs for sellers in your area and your mortgage payoff.
- Consult a mortgage lender to determine what you qualify to buy without selling? Is your credit in good shape? If you are considering keeping your current home for rental know the tax ramifications and the element of risk.
- Make sure you get a pre approval letter from your lender once you have listed your home.
Consultations with your realtor and a mortgage lender should occur about 3-6 months before you list your home.
Fix what needs to be fixed and put on the lipstick
- I have a handy dandy Home Maintenance Checklist. It is like a mini inspection with projects that you can start take care of over a couple of weekends. You really don’t want a bunch of maintenance items hitting the potential buyer in the face or a laundry list of requests from the building inspection. Home Maintenance List
- Are you located in a community that requires an occupancy inspection? If so, order it now so you don’t have any surprises.
- This time frame also includes the lipstick. Your condition can be incredible but if you don’t have that “swing,it don’t mean a thing”. It is usually best to hire a professional to give you some advice at this point. This step makes you the big bucks.
- You might want to read this article now for learning to live in a home that is on display. Getting a call for a showing after you have just settled in to watch the football game is not fun. Believe me, it is all worth it in the end,
Start Shopping
- Do as much homework as possible to find your next home. Ask your realtor to set you up on a real estate website that allows you to search for homes, save your favorites and have direct contact with your agent. Be aware of how much homes are selling for in the neighborhoods of your choice. Be aware of the average days on the market. Is the area you want in a hot area, if so, your strategy for juggling the sell/buy will need to be in place.
Many times in a popular market the seller will not entertain a “sale of home contingency”. Know your options before you fall in love. You may have to have an accepted contract on your home in order to bid on another. If that is the case, the next two weeks are going to be crazy.
(P.S. A sale of house contingency can be added to a contract. This contingency states that you must sell your current home by a certain date and the seller must give you 48 hours (negotiable) notice if they get another offer. This is basically an option to buy.)
- This can be a stressful time. If a house comes on the market that fits your needs and your home hasn’t had a showing, it’s nerve wracking to say the least. But, believe me, th ere is more than one house out there that makes your heart go pitter-pat.
Other articles that may be of interest: Buying and Selling at the Same Time; How to Juggle Listing and Looking at the Same Time
