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Program to purchase a house before selling?

2,472 Views | 13 Replies | Last: 3 yr ago by Gator92
TexLeoAg
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Hoping someone could offer some advice for a unique situation. We have recently outgrown our 'starter home' after living in it for just over ten years. We are definitely read to sell! As of now, due to 'a family situation', I cannot go the traditional route of opening my home/family up for viewings when it goes on the market.

I have heard that there are companies such as Orchard and Homeward that will submit a cash offer on a home you want to purchase before you sell your own. Obviously a fee is involved, and I am betting it is sizable. A program like this would substantially help our 'family situation' and allow us to more easily get into a new home (i.e. move into new home, then sell old home). Fortunately, my current 'starter home' is in a desirable area in which time on market shouldn't be anything over 5-10 days (being extra generous with this).

Could anyone offer any advice for our situation?

Please don't beat me up too badly on this... I just am hoping for some of yalls personal experience...

Thanks!

TDLR: I need to move family into a new home before I sell my current one. Anyway to do this?
Sazerac
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AG
Talk to a lender to see if you qualify to carry two mortgages at the same time. I've sold every house this same way.
02skiag
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AG
Are you needing to obtain money for a down payment? You can take out a HELOC loan on your current house. When you eventually sell, you pay off that loan. The only real expense is just the interest, so it depends on how long it takes to sell.
TexLeoAg
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Not really. I am wanting to purchase a new home, move my family and possessions into the new home, and then list my old home to sell. I am not sure I will qualify for a double mortgage, even though it would only be for the period of a month or two. (I am going to check on this ASAP next week). I would have no problem with cash on hand to float both notes for even longer if need be. I am just looking for the simplest option. Not terribly worried about 'service fees' if they are not overly excessive.
agdaddy04
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AG
My parents did that once awhile back. I think it was called a bridge loan. Not sure that still exists?
Jay@AgsReward.com
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Sponsor
AG
yes, we make bridge loans all the time! My email is my screen name here,

jopatura
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We just did this where we bought our new home first, then sold our old home. We had to have 50% debt-to-income ratio and slid just underneath. We looked into a bridge loan, but it would have cost us a little more in the end. We put 10% down on the new home. After our old home sold we paid another 10% to get rid of the PMI and recasted the loan to bring down the payments. All in all it worked for us and we had no issues. We had an offer on our old house within two days so that helped the timeline a bunch.
JaneDoe02
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AG
I did it using a 401K loan. Borrowed the amount I needed for the down payment from my 401K, cost me $125 fee. Paid minimum payments on that loan (cost a little interest but not too bad). Closed on new house, moved, painted old house then listed it. As soon as it closed paid off the 401K loan. Worked fine as long as you can qualify.
TexLeoAg
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Thank you everyone for the help and recommendations. I have been readying about Bridge Loans and will contact Jay soon (thanks Jay!).
thann07
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AG
JaneDoe02 said:

I did it using a 401K loan. Borrowed the amount I needed for the down payment from my 401K, cost me $125 fee. Paid minimum payments on that loan (cost a little interest but not too bad). Closed on new house, moved, painted old house then listed it. As soon as it closed paid off the 401K loan. Worked fine as long as you can qualify.


We did something similar when we were building and then got stuck with our old house not moving in March/April/May with Covid. Closed on the new place in June and sold the old place in late August.

Only issue is that now the market is considerably stronger than when we pulled the money out and I'm having trouble emotionally reinvesting. Will probably start dollar cost averaging until the election and be ready to drop it all in when the market dips at some point over the next 12 months.
ECC
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We used Homeward in Austin and had an outstanding experience. We used it primarily to put in a cash offer which was a stronger offer than having to put in an offer contingent on selling our house.

https://www.homeward.com/
JaneDoe02
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That's fair. The market was much more stable when I did it.
Milwaukees Best Light
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My wife and I are currently on the same path as you, op. We were able to secure a lease back for a could months. I know we were lucky, but it worked out for us so far. If your current house is very desirable, you should get a couple offers quickly. Just pick the one that allows the lease back option. Your agent will put the request in the sellers notes. Good luck, the whole process sucks big time.
nhamp07
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We did 5% down on the new house and then did a recast on the loan when we got the funds 2 weeks later on the house.
Gator92
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TexLeoAg said:

Not really. I am wanting to purchase a new home, move my family and possessions into the new home, and then list my old home to sell. I am not sure I will qualify for a double mortgage, even though it would only be for the period of a month or two. (I am going to check on this ASAP next week). I would have no problem with cash on hand to float both notes for even longer if need be. I am just looking for the simplest option. Not terribly worried about 'service fees' if they are not overly excessive.
Since you have enough COH, have you considered leasing starter? I bought a home and continued to live in my starter for almost 6 mos, Mostly b/c I didn't want to take my kid out of school till summer. Also, It allowed me time to remodel house before moving in. Landlording isn't for everyone, but it sure builds wealth fast. You'll never be able to finance a investment property at the rate you have on your starter.

I would first explore qualifying w/o having to sell starter.

Good Luck
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