Don’t Sell Your Home Before You Buy…Homelessness Could Await

Despite the dramatic title, winding up without a place to live is a very real possibility for second-time home purchasers.  For differing reasons, some people who are selling their current residence in order to buy a new residence may be tempted to sell their current residence before they buy their new one. 

Perhaps the new home has not been finished.  Perhaps the buyers of their current residence are offering a higher price in order to close sooner.  Whatever the case may be, it would never be my recommendation to close on the sale of your home in order to purchase your new home the next day or a few days later. 

Why? Because if your purchase falls through, you will be without your old home and without a new one.  Many things can happen to make your new purchase “bust out.”  For example, your credit could change, the new home could could burn, the mortgage markets could collapse (anyone who has worked in real estate or lending since 2007 might have seen this happen).  In any case, there are too many possibilities that might hinder your purchase.

If this happens, you might be able to close weeks later by offering a higher down payment, adding a relative, picking a new home or whatever the solution might be.  But there is an easy way to avoid this problem: sell your existing residence in a simultaneous closing wherein you will also buy your new home.  All it takes is a smart realtor and a simple contingency clause.  Call Hector Jr, Real Estate Broker, at the Chavana Office so that he can assist you in such a transaction.