Buying a new home and selling your old one at the same time can be tricky. You have no way of knowing in advance how long it’ll take to sell your current home. You could be forced to close on the sale of your old home before you’ve finalized the purchase of another, or you might find yourself closing on a new house while your old one is still on the market.
Selling and Buying at the Same Time
If you sell your current home and find a suitable new house around the same time, you may be able to close both deals on the same day. The other parties involved in both transactions will have their own needs and schedules, so it might not be possible. If closing on a specific date is extremely important to you, you might be able to offer incentives to the other parties.
Buying a House Before Selling Your Old Home
If you find the perfect new house while your current home is still on the market, you can make an offer to buy the new house contingent on the sale of your old one. That can give you time to find a buyer for your old home before closing on the new one. If you don’t find a buyer in time, you can extend the timeframe or cancel the deal. This is risky from the perspective of the party selling the house you want to buy. It can’t hurt to ask, but don’t be surprised if the answer is no.
If you buy a new house before selling your current one, a bridge loan can help you pay off your old mortgage. After your old house sells, the proceeds can be used to pay off the bridge loan. This is risky because bridge loans have high interest rates, and you’ll still owe the money even if the sale of your old home is delayed for some reason.
Selling Before Buying a New House
If you sell your current home and know that you’ll be moving into a new house shortly, the buyer of your old home may agree to rent that house to you for a short period of time. The buyer’s willingness to do this will depend on his or her own schedule.
If you sell your current home and need to move out before you’ve closed on a new house, you might have to put most of your belongings in storage and rent a place for a short time or stay with family or friends. That means you’d have to move twice in a brief period of time: once to a short-term location, and again to your new home. That would obviously be stressful, but it might be unavoidable.
Talk to Your Agent
Buying and selling homes at the same time is difficult. There are many unknowns that can influence the course of events. Discuss your options and how to handle various scenarios with your real estate agent.