How to Sell and Buy a House at the Same Time
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Buying or selling a home can prove to be hard work. Buying and selling at the same time, on the other hand, can be even more complicated. You will need to prepare your home for sale while also looking for a new home. You will have to arm yourself with lots of patience and hope for things to go as planned. However, selling your home the minute you list it and having enough time to find a new one is highly improbable. At least not until you take the correct steps at the right time. As a result, we have created a guide on how to sell and buy a house at the same time to help you achieve your goal. We will take you through all the steps, from preparing your home for sale to closing the deal and moving into your new home.
Know your options
People believe that they can sell their old house and buy a new one simultaneously. Unfortunately, things are not that easy, and one transaction always comes before the other. Sometimes one occurs before the other due to the seller's decision or the housing market. Therefore, you need to prepare for both situations. Or, decide in advance which one you would like and afford to happen first. And, to assist you in making that decision, here are some steps you should take in each of the scenarios.
1. Buy a house before you sell
While some buyers can afford to buy a home before selling, this may not be the case for you. However, there are ways in which you can work around this problem. For instance, you can make a contingent offer on the house you wish to buy. A contingent offer indicates that you can buy the house but only when you sell your current one. Furthermore, this option is ideal if you change your mind and wish to back out. Or if your house does not sell within a specific time limit. Moreover, there are no legal consequences to backing out, and you don’t lose your deposit. But, if you don’t want to use a contingency clause, you have other options.
Extended closing - you can use this option only if you are confident that your home will sell in a short time. For instance, if you can sell it in a month, you can ask for an extended closing and have enough time to find a buyer.
Use HELOC - apply for a home equity line of credit (HELOC) that allows you to borrow money based on the equity of your current home. If you are accepted, you get the funds for your down payment. Those funds you can repay after you sell your property.
Get a bridge loan - this loan is short-term, and a bank can offer it to help you cover your down payment. After you sell your home, you can pay back the loan. Just make sure that you are eligible for a bridge loan before you decide to buy. It can be hard to qualify for one, and not all banks offer this option.
Rent your old home - if you don’t need a loan for the downpayment, you can rent your home to cover the mortgage costs.
The advantages of buying a home before selling
The main benefit of buying a house before selling is that you have a place to move into right away. In addition, you only have to move once, thus saving money on temporary housing costs. Furthermore, relocation experts behind centennialmoving.ca advise on finding a new house before moving out or renting a storage space until you do. That way, you won't have to pack and unpack two times or worry about the safety of your belongings.
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When you have to sell and buy a house at the same time, you need to take into consideration that you might need to pay two mortgages at the same time.
The disadvantages of buying a home before selling
First, you may need to pay two mortgages at the same time, one for the house you are selling and one for the house you will buy. Second, you might not even get a new mortgage if you are currently paying for one. Third, the pressure of finding a buyer can lead to making mistakes. For instance, you might be willing to accept a lower offer for your property. Finally, if you rent your old house, you might find it hard to sell the house with tenants living there, and being a landlord might be more challenging than you expect.
2. Sell a house before you buy
It's not always possible to buy a new house before selling the old one. There might be a time gap between the two, but you can use it to your advantage. You don't have to rush into making any decisions, and you can take your time, especially if you are house hunting from a different part of the country. People come to Ontario from various parts of Canada, but the home buying process isn't the only one you have to prepare for. If you want to have a simple transfer to Ontario from Alberta, you need time to find the right long-distance movers. As a result, it may be wiser to first prepare for the sale and only then begin looking for a new home. So, here's what you should do if you need to sell and buy a house at the same time, with the sale coming first.
Preparing your house for the sale
Declutter - it is the first step to any successful sale. After all, no buyer wants to see a messy home. Moreover, a declutter will help you get rid of all the useless things you have around the house and ease your relocation. If you throw out all the unnecessary items now, you won’t have to move them to your new home.
Repair - if you want to have an easy and carefree sale, your home has to be in top shape. As a result, repair what has to be repaired and replace what you can’t fix. Start with the plumbing and heating systems and end with the small details like outlets or knobs.
Inspect - after you finish the repairs, you should call in a home inspector. That way, you'll know whether your house is ready to sell or whether it needs further improvement.
Beautify - also known as staging your house before the sale. This process is about making your house appealing to the buyers. For example, you can repaint the walls, redecorate the rooms, or upgrade appliances. In addition, you also have to pay attention to curb appeal. Therefore, you need to make the exterior of your home look just as good as the interior.
Depersonalize - this will help buyers imagine themselves in their future house. Therefore, remove personal items from your home, and move them to a storage unit.
Price - after you get your house ready for sale, it’s time to put a price on it. Try to be objective and reasonable, keeping in mind that you need to sell the house. Check the prices in the area and choose a comparable or a slightly cheaper one.
Rent - it’s better to move out before the house views start. That way, you won’t have to interrupt your schedule every time a buyer wants to view the property. Therefore, start looking for housing options as soon as possible.
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You must prepare your house for sale if you are selling it before buying a new one.
The advantages of selling a home before buying
First of all, you won’t have to pay two mortgages. Furthermore, it’s easier to qualify for a new mortgage if you don’t have an active one. Second, you will know how much equity you can put up for your new home. Also, it’s always better to finish one process before you take on the next. It’s less stressful and easier to handle, especially when you need to sell and buy a house at the same time.
The disadvantages of selling a home before buying
One negative is that you may have to pay for temporary lodging, which may be for a longer time than you anticipated. Then, the moving and storage costs are doubled. Once for moving out and once for moving in. In addition, house values can increase as well as the interest rates. So it might be a while until your offer is accepted.
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If you want to skip some steps you need to make for selling and buying a house at the same time, hire professionals to help you
A word of advice
When you want to sell and buy a house at the same time with minimal effort, hire a real estate agent. True professionals know how to help you through both processes. They know the market like the back of their hands and can find you the best deals. In addition, they can take care of all the paperwork and legal matters so that you don't have to stress about them.
If you're seeking advice on how to sell and buy a house at the same time, this article can provide you with important information.
Assistant Editor Marketing | Moving Offices San Diego
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