Thursday, May 3, 2018

5 Most Common Options For People Who Need Money From Their Current Home To Buy Their Next One.

Buying and Selling a home comes with challenges that are unique to each individual.  I've worked with first-time home buyers that sail through the process like a breeze and others whose home buying is more challenging.  But one of the benefits of being a first-time home buyer is that you just need to give your landlord notice to move from your current home.  Homeowners looking to buy something else have another hurdle they have to get passed.  How do you get the money from your current home to use it to buy the next? Here are 5 of the most common ways you can go about doing this.

1. Sell your current home and take the proceeds from that sale then and move into a short term rental until you buy your next home with your proceeds ready to go.

2. Explore the options of having a family member help you with your next downpayment.

3. Ask a lender how much money you could take out of your current home to use for the next.  If you choose this option, your lender will likely tell you there is a waiting period from when you take that money out, until you can sell that home. 

4. Put your home on the market for sale and ask the buyer for a "Rent Back" which is when the buyer becomes the owner and you become their tenant for a short time.  There are some pros and cons to doing this so make sure to talk to your agent about what they may be.  Going this route may be gambling a bit since it leaves you a limited, finite amount of time to find and buy your next home.

5. Put your home for sale contingent on buying your next home. This means your agent will put something into the contract when the buyer makes an offer on your current home that states the home can not complete the sale until you have found your next home. However, this also means you need to put something in the contract on the home you intend to purchase that says you can't complete the sale of that home till your current home sells. A bit of a domino effect can be created doing it this way.  This is the trickiest way to go straight from one home to another but for most, it's their only option.

Any option you choose, make sure you have an agent that is very hands on.  For most people, there needs to be a lot of creative problem solving done between clients and agents and clients tend to need a lot more questions answered as situations get more convoluted in the selling/buying process.