Are there alternate options to a house sale contingency?
If a house sale contingency simply isn’t attainable on your deal, Allen says that there could also be different alternate options.
Bridge loans
A bridge mortgage is a short-term mortgage that permits you to purchase a brand new dwelling earlier than promoting your present one. It “bridges” the monetary hole by offering non permanent financing till your private home sells. Whereas this selection will be useful, remember the fact that bridge loans usually have greater rates of interest and costs.
Allen says, “It allows you to keep your current home and your mortgage and then tie the new house that you’re wanting to buy into that. [The lender will usually] give you up to twelve months to sell your previous home, then they recast your loan amount, so that you go back to what your original loan payment would be on the new house. So, if you’re nervous about writing first rights or contingencies, a bridge loan [could be] a great way to avoid that whole conversation.”
Residence fairness line of credit score (HELOC)
In case you have vital fairness in your present dwelling, you could possibly take out a HELOC to cowl the down cost in your subsequent dwelling. This feature permits you to leverage your private home’s worth whereas avoiding the uncertainty of a house sale contingency. Nonetheless, it’s necessary to notice that you simply’ll be making funds on each your mortgage and HELOC till your private home sells.
Negotiate an extended closing interval
As an alternative of together with a house sale contingency, you might negotiate an extended closing timeline with the vendor. This provides you further time to promote your private home whereas reassuring the vendor that your buy isn’t depending on the sale.
Make a non-contingent provide with financial savings
In case you have sufficient in financial savings or can entry different liquid belongings, you may have the ability to buy a brand new dwelling with out promoting your present one first. Whereas this selection requires monetary flexibility, it provides you a stronger negotiating place and reduces the danger of shedding the house to a different purchaser.
Promote your private home first and lease briefly
An alternative choice is promoting your present dwelling first and briefly renting when you seek for a brand new one. This ensures you might have the proceeds from your private home sale in hand, eliminating the necessity for a contingency. Whereas this may increasingly put you in a greater monetary place when making a suggestion, you may need to maneuver twice, which additionally has price implications.
Purchase earlier than you promote
There are actual property answer firms like HomeLight that present handy applications that streamline the method of shopping for and promoting a home on the identical time. These “Buy Before You Sell” or trade-in applications can present a bridge that will help you efficiently full your transfer to a brand new dwelling.
For instance, HomeLight’s Purchase Earlier than You Promote program, accessible in most states all through the nation, permits you to buy your new dwelling and transfer in whereas getting help to promote your outdated dwelling. Contact HomeLight for program particulars.
HomeLight additionally presents different companies for homebuyers and sellers nationwide, similar to Agent Match to search out the top-performing actual property brokers in your market, and Easy Sale, a handy approach to obtain a no-obligation, all-cash provide to promote your private home in as little as 10 days.
Different actual property firms that assist bridge the method of shopping for and promoting on the identical time embrace:
- Flyhomes
- Orchard Transfer First
- Knock Residence Swap
The most important factor we at all times inform our shoppers is that we need to guarantee that they’re by no means homeless and so they by no means have two mortgage funds on the identical time. As a result of both a kind of situations is in the end the worst.
Jesse Allen Actual Property Agent
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Jesse Allen Actual Property Agent at Keller Williams
- Years of Expertise 8
- Transactions 108
- Common Worth Level $168k
- Single Household Houses 101
Conclusion: A house sale contingency presents peace of thoughts
Allen wraps up the underside line properly: “The biggest thing we always tell our clients is that we want to make sure that they are never homeless and they never have two mortgage payments at the same time. Because either one of those scenarios is ultimately the worst.”
Whereas sellers could also be hesitant to simply accept a suggestion with a house sale contingency, the fact is that many patrons right now discover themselves needing one. So in impact, whereas a vendor could desire a suggestion and not using a dwelling sale contingency, they could by no means obtain one. Subsequently, you as a purchaser ought to embrace contingencies –– together with dwelling sale contingencies –– that take advantage of sense for you. Seek the advice of together with your agent on find out how to make the perfect provide with a house sale contingency, in the event you want one.
When you’re planning to promote and purchase a house in 2025, HomeLight can join you with a top-performing native actual property agent. Our free Agent Match software analyzes over 27 million transactions and hundreds of opinions to find out which agent is greatest for you primarily based in your wants.
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