Will the seller wait for me to sell my house or does the bank front you the downpayment money until you sell your house?
2006-08-04 05:02:29 · 8 answers · asked by journalboy 2 in Business & Finance ➔ Renting & Real Estate
When you find your new place and apply for the mortgage, tell the lender that you need a "bridge loan" for your old property. If the numbers work out right, they'll advance up to 80% of your home's value less any outstanding debt for you to use as down payment and closing costs on the new place.
Bridge loans typically have a somewhat higher interest rate but no payments are required, usually for the first 6 months. After 6 months you normally can make interest only payments if your old place hasn't sold yet. Once your old place sells, the bridge loan and any accured interest are paid off from the proceeds on your old place.
Don't bother with a contingent offer on the new place. Sellers are generally not interested in having to wait for you to sell your old place. I've sold a number of homes over the years and NEVER consider an offer contingent on the buyer selling their old place.
2006-08-04 05:12:20 · answer #1 · answered by Bostonian In MO 7 · 1⤊ 1⤋
Whether the seller will wait for you to sell your house will depend upon the market and other offers they get, as well as their personality.
This is a fairly common thing. The least stressful thing is to sell your house first. If you do this, make certain you keep the HUD 1 form as the lender on the new property is going to require you to show where you got the money.
Here's an article on some of the issues:
http://www.searchlightcrusade.net/posts/1152808112.shtml
Bridge loans are sometimes a good idea, and sometimes not. It depends upon the situation.
2006-08-04 08:12:55 · answer #2 · answered by Searchlight Crusade 5 · 0⤊ 0⤋
Make a contingent offer. This works by stipulating the purchase of the new home on the sale of the old home. To make the overlap work from a timing sense, you might have to stay in your old home a week or two so that the money clears escrow from the sale and is transferred over for the purchase (to close that escrow).
Your real estate agent and lender should be able to assist you with this. It happens all the time.
2006-08-04 05:10:50 · answer #3 · answered by Anonymous · 0⤊ 0⤋
Sell you current house first. Then take a cashier's check from that sale to the closing on your new house.
But that's entirely up to the seller of your new house, as well as the bank if you're financing the balance as to whether or not they'll wait.
If the bank issued a loan on your present house, you couldn't sell it until the loan was closed, so that's not an option.
2006-08-04 05:07:33 · answer #4 · answered by J.D. 6 · 0⤊ 0⤋
You have to put a contingency on the contract that your home must sell before the close of the home to be purchased. But that doesn't mean you'll get the house.
Normally you cannot used borrowed money for a down payment. Contact a local mortgage rep and ask.
2006-08-04 05:09:03 · answer #5 · answered by voandginger 4 · 0⤊ 0⤋
You approach a real estate agent with your proposal and they being experts in the field should be more than happy to guide you through successfully, including finding a suitable house to suit your taste! Don't worry, your situation is not abnormal and it is pretty common for many prospective home buyers to be in the same boat as you!
2006-08-04 05:11:55 · answer #6 · answered by Sami V 7 · 0⤊ 0⤋
I dont now about your state, but here you can do a 1031 tax deffered. You sell your house then your money is heald by a irs 3rd party. you have 180 day to make the purchase and the money that you use to purchse the house it not taxed.
2006-08-04 05:10:10 · answer #7 · answered by Anonymous · 0⤊ 0⤋
It's called a bridge loan. People do it all the time.
2006-08-04 16:39:40 · answer #8 · answered by unclejesse1 3 · 0⤊ 0⤋