Can i purchase a house for 5% down, then sell my 1st home and use that money towards new loan ,then refinance?

Question

$230,000.00 would be the purchase price.

Answer 1

If you can qualify, sure. With one mortgage already that might be difficult. You might see about a bridge loan, they may not exist anymore with the current mortgage problems, but you get an interest only loan for say six moths, which transfers into a fixed rate loan, the rate is locked in a todays rates.
You should be able to apply proceeds from the sale to the new loan, maybe within some range, ie they will loan you a max of X and a minmum of 70% of X.
In todays market I would rather have a sale pending on my current house then make an offer on a one of the houses that are on your target list. The closing on the new house is pending the closing on your current house.

Answer 2

Much depends on the seller and your ability to finance the rest of the deal .... you could have finance arranged that covers the difference - and if the seller agrees to the 5% deposit then you would have a deal .....
How you repay the finance for the send property is up to you = sell the 1st property - rent it out and use the rental monies against paying the finance .... you may find that the sale monies of your first house will cover the majority if not all of the price of your second house .... it all depends how you want to work it - you could pay off half the purchase price (from the sale of the 1st house) and only have a 130 loan - or whatever amount you want to leave yourself as a mortgage ......

Answer 3

Your question is "can I" so the answer has to be yes you can. If you had asked the question differently and perhaps you meant to do so...Maybe the question is really will I be able to sell etc. then it will be a more conservative answer of a definite maybe. The markets in a lot of cities has slowed as I'm sure you know. What that means to you in the real world is an offer on the new property that is contingent on the sale of your existing property, which means you are hoping a seller is flexible enough to want to wait for you to sell and also hoping your current house sells quickly. Kind of a conflict in terms don't you think? Then when you think about refinancing...you are hoping to have developed enough equity through all of this exercise to be able to refinance-one important fact-be sure that there is NO PRE PAYMENT PENALTY in the first loan and no exclusion about refinancing! Some will say not for 2 years so be sure before you sign or you will have to wait. This is a long answer for a short question but, I hope I helped by trying to understand what you might really have wanted to know.

Answer 4

If I understand you I believe it is similar to what I just did. I wanted to buy a house (so it would not get away) and then later put my old house on the market.

I thought about doing an 80/20 loan on the new house and then paying off the 20% second when I sold the old house.

My loan officer listened to me and suggested that I get a "bridge" loan on my old house and use that money to put my downpayment on the new house. Then when i sold the old house I would be paying off the mortgage plus the bridge loan.

This ended up being the least expensive way for me to accomplish this.

I sold the old house about 2 months after I put it on the market because it showed better without us and our dog living there.

Answer 5

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Answer 6

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