Buying a home before you sell your current property is not an uncommon decision. People may make this choice for any number of reasons ranging from needing to move quickly, or wanting to purchase their dream home in a competitive market. If that's the route you are taking, there are financing options available to help make your transition smoother and more manageable.
The first option is to try and get a loan that allows you to borrow enough money to cover the cost of both your new home and the one you are selling. This type of loan would be considered a bridge or wrap-around loan, which means that the loan will be secured by your current property as collateral until it is sold. This can be a great option for borrowers who have good credit, can demonstrate their ability to pay back the loan, and don’t mind having two mortgages at the same time.
Another financing option is to get a home equity loan or line of credit on your current property before you put it up for sale. With this type of loan, you can borrow against the existing equity in your home and use it to fund your new purchase. This allows you to leverage your current property as collateral while still pursuing a new home.
Finally, if you don’t want to take on two mortgages at once or have sufficient equity in your current home, another option is to get a personal loan. This could be a great option if you are looking for a more flexible repayment term, as most personal loans have much shorter terms than traditional mortgages.
No matter which financing option you decide to pursue when buying a house before selling your current property, it is always important to do your research and make sure that the loan fits your needs and budget. With the right financing in place, you can make the transition from one home to another seamlessly and stress-free.
By considering each of these financing options carefully, you can be confident that your decision to buy a house before selling will be a smart financial move. Good luck!
