(Closed) Buying a home before you sell.

posted 4 years ago in Home
Post # 2
Member
1261 posts
Bumble bee
  • Wedding: October 2014

We did this but we did not need anything like what you needed. Our bank told us we were in fine coniditon financially to afford a second mortgage and purchasing our new home was not contingent on the sale of our current home. 
I really think its all based on your personal financial situation. In that case it sounds like a ton of work! If its something you want to do I recommend taking an hour or two off of work to sit down with your bank and figure out how to feasibly do this given your current financial standings and how things may be improved.

Post # 3
Member
47212 posts
Honey Beekeeper
  • Wedding: November 1999

I have done it in the past, but I doubt that it would work this way in the current market. I bought a new home conditional on my selling my old place by a certain date. The sellers acceptedy offer with the condition attached, and I managed to sell my place by the specified date.

Vancouver is such a hot market right now that sellers don’t need to accept any conditions.

Post # 4
Member
1017 posts
Bumble bee
  • Wedding: October 2015

We did this!  We put a downpayment on the new house and just got a second mortgage and continued on as normal. Felt good to sell the old house because 2 mortgage payments is lame.

Post # 6
Member
1332 posts
Bumble bee
  • Wedding: May 2014

Stephanie8904:  WE ARE SO CLOSE TO FINISHING THIS VERY PROCESS (can you tell I am excited?!), so can chime in!! This is the order of which we did things, and can attest that we were truly lucky in the process…because we had not plans to buy or sell, until we stumbled across our ‘dream’ home!

Once we found the home we could not walk away from, which was honestly done out of boredom of me doing a search for anything new on the market, we had to get pre-approved before making an offer.  I utitlized the realtor’s mortgage guy for the pre-approval, and we received it without the contigency that we sold our home (meaning, we could carry both mortgages if need be, although it would be awful).  We had saved enough to put 20% down on our new home without needing to sell our current home, which meant that IF we did not sell our home, we would be in a tight situation as long as ours remained on the market.  We also asked for, and was approved a 90-day close on the new home, so we could out current home on the market, and hopefully sold…

And so the underwriting process began on our new home, and the negotiations….inspections, etc…

THANKFULLY, our home sold in 3.5 weeks (right before Thanksgiving), and the buyer wanted our home by February 1st, which took us a few days past the close of our new home.  We were very lucky in that regard.  I think the biggest thing we did not account for was what our home inspection would render, and what we would need to repair to sell it, which of course was negotiated, but still was another $1000.00 we had to shell out (while buying a new home :()

As it turns out, however, we close on our new home 1/15, get the keys 1/20, close on our current home 1/27, and turn over the keys on 1/31.  Where our savings will be completely depleted, we get *some* of it back when we sell our home, because we sold for quite a bit more than what we owe.

This process is not for the faint of heart, and has actually caused a ton of stress on each of us, and in our marriage.  I was panicked when our house did not immediately sell, and then was panicked when it did, and could not fathom how we will be out in 10 days time (we also have an infant on top of all of this!!).  However, as I sit here venting, I cannot say how lucky we are to have had the process work out in such an ideal way, because carrying 2 mortgages would have been incredibly hard too.  

I now cannot imagine selling our home without having a home to move into like others have had to do in our circle, so I am not sure there is an ‘ideal’ way to buy then sell, or sell then buy!!!  GOOD LUCK!

Post # 7
Member
586 posts
Busy bee
  • Wedding: June 2016

Stephanie8904:  We did this about 1.5 years ago, but did not have to meet any additional requirements (we were able to put down a pretty good amount on the new place). We were originally planning to keep our first home and rent it out until we could get what we wanted for it – so we did not put the sale of the new house contigent on the sale of our first home. We ended up deciding to sell our original home a few months later though when we realized that the market in the area had improved significantly and we were able to sell it for more than we wanted for it.

Even though it was a pretty “safe” buy for us, it was still stressful to have two mortgages – I’d recommend avoiding it unless you have a special reason.

Post # 8
Member
1332 posts
Bumble bee
  • Wedding: May 2014

Stephanie8904:  Follow-up to your second post:  The reserve might just be the way your market is going right now.  Are there a lot of foreclosures coming up, etc?!  It might be a requirement for that reason, as a way to protect these lenders from buyers biting off more then they can chew, and ultimately not being able to afford both homes…?!

That is my best guess, but was not mentioned in our preapproval or loan underwriting…

Post # 10
Member
5827 posts
Bee Keeper
  • Wedding: May 2011

We bought our home three years ago and still own (and rent out) our townhouse. We didn’t have any additional reserve requirements, we just had limits on what we could borrow considering we would be covering two mortgages. It wasn’t an issue since they approve you for a ridiculous payment amount.

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