Which Comes First, Selling Your Home or Buying a New One?
You are buying your second home but need the proceeds from the sale of your current home to do so. Should you buy or sell first? Yikes! How is this possible?
Relax. I can help you do this. Let’s just break down the tasks.
Get Your Home Ready to Sell
First, you need to prepare your current home for sale by getting it in top-notch condition. You know the drill: de-clutter, update, remove buyer’s objections, landscape, stage, and prepare for fabulous photographs to attract the most qualified and motivated buyers. It’s never easy preparing your home for sale, but the hard work done in advance will almost always result in a quick and more prosperous sale. So, roll up your sleeves and get to work!
Contact Your Lender
In the midst of all this, get in touch with your favorite Lender and discuss how much money you can afford to spend on your new or second home. You should always choose a lender who can help you decide whether to buy or sell first. I always give my clients a realistic estimate of what their homes will sell for and the amount they should net from that sale after their mortgage is paid off. Hopefully, that is where you will get the funds for the down payment and closing costs on your second home.
Shop For Your Next Home
Once your home is ready to go on the market, it’s time to shop. I’ll set up a search with your criteria and you can shop from the comfort of your home, viewing photos and virtual tours of prospective homes. If you are planning to buy in the same town, you probably already have a good idea of the neighborhood and the type of home you are looking for.
It’s okay to shop a bit while you are preparing your home for sale – when you see a home that you really love, that will motivate you to get your home ready to sell. However, DON’T shop until you know the amount you can spend – it’s no fun to fall in love with a $400,000 home, only to find out you shouldn’t spend more than $375,000!
Ideally, we will shop for your second home when your home goes on the market. Your goal will be to narrow down your list of favorites to two to three homes. See Finding A Home in my Buyer Guide.
Once you’ve accepted an offer on your current home we will prepare an offer on your new home CONTINGENT upon the successful closing of your home for sale. See my Buyer Guide for info on writing a strong offer. In addition to your offer, you will need to provide the contract on your home for sale and your buyer’s preapproval documentation.
Inspections and Repair Requests
Once your offer on your second home is accepted, you will proceed with inspections and providing documentation to your Lender.
And back at the ranch . . . your buyer will be conducting inspections on your home for sale, you’ll be making requested repairs AND you’ll be packing. A lot of work will be going on simultaneously!
Closing!
When the final day of closing is here, you will close on your home for sale in the morning and close on your purchase that afternoon. Yes, you will have to have your home for sale cleared out when you hand the keys over to your buyers, so you may have to pay a little extra to the movers.
This is what we refer to as “domino closings” because if the closing on your sale is delayed, that obviously will delay the closing on your purchase. It’s especially important that you have representation of a professional Realtor® who will coordinate with Lenders and the Title companies involved to ensure that all is on track.
Summary: Buying and Selling at the Same Time
1. Prepare your home for sale and get it on the market
2. Contact your Lender to see how much you can spend on the second home
3. Shop!
4. Conduct inspections on the new home while making repairs on the home you are selling; keep packing!
5. CLOSE ON BOTH PROPERTIES! Congratulations, you answered the question of whether you should buy or sell first.
This may seem like a daunting process, but as an experienced Realtor®, I will guide you through the process.
If I can help you purchase your next home while selling your current home, give me a call! 918-852-5036
Lori Cain, REALTOR®, Serving Midtown and the greater Tulsa, OK area. Call 918-852-5036.
