Selling and Buying at the same time

KC41213September 3, 2013

New to the forums :) Maybe you have some advice?

According to our lender, my husband and I must sell or have our current home under contract before we can get pre-approved to purchase a new home. We are in the process of listing our house for sell this week. We have already found 2 homes that we are interested in putting an offer in on. We are now wondering how this will all work out. We are really hoping that our house will go under contract and one of the homes we are interested in will still be available. What if these homes we are interested in are no longer available and our house sells? Has anyone else had a similar situation and if so how did things work out for you?

Thanks!!

Thank you for reporting this comment. Undo
live_wire_oak

If you've got to have the home under contract for even a pre-approval, then you want to hold off on looking for a home, maybe until you save more for a down payment Usually, with enough down, plus the proceeds from the home sale, lenders don't have an issue with a pre-approval. Your lender is telling you that you don't have enough saved. Or maybe your home is underwater and you will need your savings to be able to get out from under it? Either way, hold off.

    Bookmark   September 3, 2013 at 4:42PM
Thank you for reporting this comment. Undo
kirkhall

You can offer a contract contingent on your house selling.
That will make your offer a weaker offer than someone who does not have that contingency, but if you are worried, you can do that.

Most people in your situation, sell their house, then begin looking for their next home. Generally, there are more homes available to buy than people who want to buy YOUR house, so you want to sell yours first.

A good RE agent can help you with the process and correct financial protections to save you should your house sale fall through.

    Bookmark   September 3, 2013 at 5:44PM
Thank you for reporting this comment. Undo
nancylouise_gw

I would sell your present house first, then start looking for a new home. What happens if your house doesn't sell but you buy your new home? Are you financial able to carry 2 mortgages? We always sold first then bought a new home. We stayed with family or rented a house if there were no homes that we liked enough to buy. NancyLouise

    Bookmark   September 3, 2013 at 6:05PM
Thank you for reporting this comment. Undo
littlebug5

I agree. If you can't even get pre-approved until you sell your house, you are not ready to buy a new one.

Wait and save your $$$. IF you do happen to sell your house, THEN start looking.

    Bookmark   September 5, 2013 at 9:29AM
Thank you for reporting this comment. Undo
virgilcarter

It all about your debt ratio (debt to income). If you can show more income (or remove more debt, or both) you may be able to meet the minimum threshold (around 40%-45% in my case, as I recall, with Chase recently).

Otherwise, the wise (perhaps only) alternative is to:
1. Sell you house;
2. Find a new house (or rental until you find one you desire to purchase).

The days of easy money and no concern for debt limit and potential default are thankfully gone.

Good luck on your project.

    Bookmark   September 5, 2013 at 4:30PM
Thank you for reporting this comment. Undo
kellienoelle

KC, I went through a similar scenario in the spring and had a few tense weeks where we thought that we may go homeless, but in the end it all worked out. Are you in KC by the way, because I am familiar with that market.

We initially tried to do an offer contingent on the sell of our house, but it wasn't accepted due to the contingency. We probably could have swung two mortgages, but I am pretty financially conservative so this was a risk I wasn't willing to take. In the end our house sold very quickly which was great, but so did all the other houses out there that we were interested in. Kind of a hot market in the spring, and it was a distinct prossability that we would be unable to find a house that met our requirements. I didn't want to sacrifice what we wanted while under pressure so our back up plan was putting our stuff in a Pod and either doing a short term rental or staying with family while we continued to look.

How it worked for us....in the last hour we found a great house. The one compromise was in the price (spent a bit more than we originally thought we would like to), but we have been here for about 4 months and couldn't be happier. In the end I am glad to have upped the budget (I mentioned that I am financially conservative....too much so at times) to be in the house and location that we finally settled.

Good luck, the process is much less fun than I had thought it would be!

    Bookmark   September 7, 2013 at 3:41PM
Sign Up to comment
More Discussions
How do you value a pole barn?
Does anyone have a good rule of thumb for appraising...
weedyacres
An offer to purchase when house not on the market
This has not happened yet, but I want to be prepared. Our...
belfastbound
Questions for buying a home with a septic system
I just came across an interesting article about issues...
cbrooks42
Help, quick! VA Loan Problems?
My friend is selling her home. She's received two...
jewelisfabulous
Figuring out who is a good Real Estate Broker?
I want to explore the market right now and get out...
prairiemoon2 z6 MA
Sponsored Products
Campania International Tall Bamboo Cast Stone Planter - P-634-AL
$609.99 | Hayneedle
Small Dragon Garden Statue - OR-08-GS
$134.99 | Hayneedle
Sterling Finesse 5475-59-G68 59.625W x 70.3125H in. Oak Park Glass Shower Door -
$748.99 | Hayneedle
Novella Olde Brass Six-Light Ornate Cast Brass Pendant with Golden Teak Hand Cut
Bellacor
Red 3528 Single Row LED Strip Light 240/m 10mm wide Foot
EnvironmentalLights.com
Campania International Mini Tall Reef Square Cast Stone Planter - P-586-AL
$59.99 | Hayneedle
Campania International Arezzo Cast Stone Planter - P-436-AL
$494.99 | Hayneedle
Sunnydaze Beige Outdoor Water Fountain Cover, 80 Inch Diameter, 80 Inch Tall
SerenityHealth
People viewed this after searching for:
© 2015 Houzz Inc. Houzz® The new way to design your home™