One of the biggest decisions a home seller can make is whether they want to buy their new home first, sell their current home first, or try and do both simultaneously. Before you begin this process, there are a few things you should know.
The very first thing you need to do is get pre-approved by a lender. This lets you know what you can afford and what kind of home you can get for your budget. Sometimes it’s not about what you can afford but what you’re comfortable paying each month.
The next step is determining how much equity you have. If you are planning on selling before you buy, you can use the equity in your current home to purchase your new one.
If you’re just going to buy a home, the great thing is that you don’t have to worry about selling a home or trying to time the transactions. You have time to find the perfect home, renovate it as you like, and make everything perfect for when you’re ready to move into it.
If you are going to sell first then buy, you’ll know what your equity situation is ahead of time, but the hard part is that we’re going to have to pre-plan to make sure everything is squared away. Inspections need to be done, photos need to be taken, and many other things need to happen to get your current property ready so that the sale doesn’t delay your next purchase. You won’t have to carry two mortgages, but there may be some other challenges.
In any event, it’s important to think ahead, plan, determine (based on a net sheet) where your financial situation is, and what you need to do to prepare for either or both transactions to be successful.
If you have any questions about buying, selling, or real estate in general, don’t hesitate to reach out via phone or email. I look forward to hearing from you soon.