Most people are selling their home to move into a new home that better fits their current situation. Many time this involves the need for a bigger home with more space that comes at a higher price. Real estate deals are done every day, but that doesn’t mean that you will sell your house and find a new one all at once. While this process is doable it is a delicate process. There are three ways to sell your current and purchase a new one.
Sell First, Then Buy. This is perhaps the safest plan, although it requires multiple moves. In this scenario you would sell your home first before looking for new homes. Most people move the majority of their property to a storage unit and arrange a temporary living arrangement while they find their new home. The advantage to this is you know exactly what you can spend on a new home and not have to worry about temporary financing. Not having a new home waiting in the wings will make you less tempted to drop your price or take the first offer you get. The disadvantage is this can be a disruptive process and you can’t know for sure how long you will be in your temporary arrangement.
Buy First, Then Sell. This strategy minimizes the disruption to you, but is also risky if you still owe on your home. You can move into your new home at your leisure and take time to prepare your old home for sale. However having not sold your old home you would not only be responsible for two mortgages, but security and upkeep on both properties. This scenario works best if your old home is completely paid off.
Buy and Sell Simultaneously. In a perfect world this would work all the time. That’s not always the case. If you are executing this you need to be aware that if anything falls through you could be facing one of the scenarios above. The tricky part for most people is the financing. If you are trying to simultaneously buy and sell you will want to make sure you have a plan if something falls through on either the purchase of a new home or the sale of your current home.
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