- Endsley Team
- +1(850) 320-8422 endsleyteam@gulfrealty30a.com
How to Buy & Sell a Home at the Same Time - An Expert's Guide
Are you considering selling your home while also needing to purchase a new one? Wondering what options are available to you? Let's explore the possibilities together!
1) Make an offer on a home with a home sale contingency. A home sale contingency states that if you are unable to sell your home, you will not be obligated to proceed with the purchase. There is a stated deadline for the sale of your current home. If your current home doesn't sell by that date, either party can cancel the contract and you will get your Earnest Money Deposit back.
The Pros: Your earnest money is protected. You can offer on your next home before selling your current home.
The Cons: It can be difficult to get sellers to accept this contingency. In this area of Florida, if a seller accepts a home sale contingency they will often add a "Kick Out Clause". In short, a kick out clause means they can still accept other offers. Your offer can be cancelled if they get another offer they like and you are unable to remove the home sale contingency from your offer. You will also have to carefully line up your home sale and home purchases so that you can complete both successfully.
2) Get a Bridge Loan, Home Equity Loan, or HELOC (Home Equity Line of Credit). If you have a larger amount of equity in your current home, you may be able to finance the closing costs and down payment for your next home with one of these loan products. Talk to a trusted lender to see what your options may be.
The Pros: You would not need to sell your current house before completing the purchase of your next house.
The Cons: There will be additional financing charges. If you don't sell your current home in time, you may have two mortgage payments.
3) Purchase a new construction home. New construction homes often go under contract a few months before they close.
The Pros: You have more time to sell your home.
The Cons: Builders often will not accept a home sale contingency. If your current home doesn't sell, you will still be obligated to purchase the new home or else lose your earnest money and be in breach of contract.
4) Use a Cash offer company. These companies are relatively new to the industry, and their offerings and pricing structure vary. One such company that operates in the Florida market is Homeward. Homeward offers a "Buy before you sell" loan product where they will purchase your next home for you with cash. You buy it back from them once your current home sells. They charge you a pro-rated rent until you buy it back from them. When you do buy it back, they sell it to you at the same purchase price they paid, plus a 1.9% fee. For detailed information about this or similar companies, please contact them directly.
The Pros: The purchase of your next home can take place before you sell your current home.
The Cons: After the new home closes, you will be charged rent until you buy the home back. If it takes some time to sell your current home, it could be difficult to pay your current mortgage and the rent.
5) You find temporary housing. If one of the options above won't work for you, you may need to consider selling your home and move into temporary housing such as a month-to-month rental or a friend/family member's house while you look for your next home.
The Pros: There will be no additional financing charges or fees. You'll be certain of your budget and timeline.
The Cons: You have to move twice, and may have the added expense of moving costs and storage fees.
6) Ask for a Leaseback. If you'll be selling your home before you are able to move into your next home, you could try to negotiate a leaseback. A leaseback allows you to stay in your current home after closing day. Leasebacks are not common in this area of Florida, and if you request one you should be prepared to make the duration as short as possible. The duration and amount of rent you'll pay will be negotiated in writing before you close on your current home.
Want to learn more? Our team of experienced agents will be glad to answer your questions! Reach out any time. Happy buying and selling friends!
- Julie
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