Making it Work When Selling & Buying a Home at the Same Time
Remember your first time when buying your first home and you are a house buyer newbie? Yes… it wasn’t easy as a pie. Whether you have to move or downsizing, you will need to sell your home and buy a new one. Buying your first home is quite easier since there’s no excess baggage on your back. But since you are moving into a new place, you need to think about selling your home AND buying a new house. You might be wondering, how other people could do this at the same time?
We will give some of the aspects so you could have an idea what to look forward and how would you do it.
Do your own assessment.
You need a general view of what you will be dealing with. Research on how the housing market is doing in your area or in the area you are planning to move to. By doing your own homework will help you understand more and have intelligent questions to ask your realtor. Is it the seller’s or buyer’s market? How long it usually for a property to stay on the market? What is the average price within the area and so on? How competitive is the market nowadays?
Knowing the situation beforehand will guide you on what things you need to anticipate and to ready for.
Plan your steps.
After careful assessment, you have a clear outlook on what steps you will take. If you are going to sell before you buy a new home, this is good to your financial leverage but then you have to think about where you will stay if you sold your house before finding a new place. If you are going to buy your new home and sell after, this will affect your financial capability to pay two mortgages every month. In case you found a lender who will approve your loan, this will affect your household debt-to-income ratio. It will be convenient to have a place to move into but it will take a toll on your finances. Remember, money put down to your new place shouldn’t be borrowed. You have to be financially ready for this.
Planning your steps when buying and selling a home at the same time needs one step ahead of thinking. Anticipate the things you have to face in case one step falls apart. In this business, you are not the only factor that has an effect in this process.
Set expectations realistically and achievable.
No matter how your plan was laid out perfectly, you have to expect the unexpected. Prepare yourself mentally, emotionally, physically, and financially. It doesn’t mean that when we plan just a small setbacks will be encountered, this goes to setting our expectations like thinking you can sell a house in a month or your offer will be accepted because it was fair and good.
Prepare financial contingencies.
Since home buying or selling is a vital financial decision, planning when your plans won’t go your way is important. Knowing your finances fully will help you make adjustments and avoid making big mistakes like accepting a low offer for your house or purchasing a new home because you must move right away. Discuss with your financial advisor or mortgage broker what your options are when something fails. Some homeowners tend to strike a deal with new owners of their house to rent it out to them on a month-to-month basis up to 60 or 90 days until they find their own new home. Knowing what step to take when plans don’t go your way will help you reduce the risks and the stress.
Don’t get emotional.
When everything fails or a deal fell apart, don’t let your emotions take over your decision-making facilities. Do not panic. Since you have done your part and made your plans, don’t let your emotions get in the way to make a sound decision. You can call a professional, your realtor, to guide you since they have the skills for this business.