real estate

5 tips to sell home before buying another

Q: Who can afford to buy before selling?
Who can afford to buy before selling? © style-photography.de/Shutterstock.com

Buying before selling isn't feasible for buyers who don't have enough money to make a down payment or don't earn enough to qualify for two simultaneous mortgages.

Before the financial crisis, home sellers could obtain "bridge loans" to finance down payments, says Neil Caron, vice president of retail production at Freedom Mortgage Corp. in South Windsor, Conn. Bridge loans were short-term loans to be repaid as soon as the borrower's first house was sold. Now, if sellers need the proceeds from the sale to use as a down payment, it's difficult, if not impossible, to find bridge financing, Caron says.

Another option is to use the proceeds of a home equity loan as a down payment, adds Charles Chedester, past president of the trade group Mortgage Professionals of Iowa. The caveat here is that sellers must apply for home equity credit before they list their homes for sale because lenders won't extend loans on properties up for sale.

advertisement

Show Bankrate's community sharing policy
          Connect with us
advertisement
MORTGAGE & REAL ESTATE NEWSLETTER

Timely market news and advice for consumers ready to buy, sell or invest in real estate. Delivered weekly.

Blog

Polyana da Costa

Bullish jobs report bad for rates?

The employment report released this morning is great news for the economy but not so much for mortgage borrowers.  ... Read more

advertisement
Partner Center
advertisement

Connect with us