The ideal situation for current homeowners looking for a new house is to coordinate the closings for both properties on the same day, allowing an effortless transition from your current home to your new one.The real world however is not this simple.
What we tend to see is either of the home closing earl and you being stuck homeless or even worse having two mortgages to deal with.
In the current market we are seeing an increase in sales, but that does not mean you house will sell right away.
Here are a few ideas you can do if your home sells before your new one is ready.
• You might be able to negotiate with the new homeowners to rent your old house to you for a short term until your home is finished. You will be required to pay the mortgage, property tax, utilities, etc until your home is ready but that is a given. This is a good idea if you know that your house will be closing within a month.
• If your closing date exceeds a month, you may want to move in with your family. This is a great option if you are close with your family and they do not mind having the extra bodies in their home
For the other scenario of your new home closing first, you should consider the following.
• The cheapest way to find a down payment for your new home is to borrow of a home equity line of credit. No matter what you borrow, you can easily pay off when you sell your home.
• A bridge loan is always an option if you cannot tap the equity in your home. This type of loan allows you to borrow money for a down payment on the new home based on the equity you have in the first house.
Personally I find having to manage two homes more trouble than actually finding a place to stay until your new home is closed. Well we cannot exactly choose which situation we come in. Whatever the case is, at least now you have a few ideas on what to do if you are in either situation.
Glen Chapman
Broker of Record with Club “100″ GMAC Real Estate
www.club100realestate.com
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