Buying a new home can be a stressful experience, and that stress is often doubled when you’re also trying to sell your current home at the same time. If you’re in this situation, you’re certainly not alone. The National Association of Realtors estimates that 71% of repeat home buyers owned their previous homes and likely had to buy and sell simultaneously. Timing is the key when it comes to pulling double duty as a buyer and seller. The ideal timing is to sell your home, use the built-up equity for a down payment on a new home, then buy your dream house. However, this is often not the way the process works. Are you in a situation where you’ve begun looking at homes for sale in Sun Valley and are also working with a real estate agent to sell your current house? Here are some tips on how to make the process a success.
Choose a Funding Option
If you and your Sun Valley real estate agent cannot sell your current home before buying your next home, you’ll have to come up with funding for your down payment, as your equity will still be tied up. Here are some funding options:
â—¾ Cash-out refinance on your current home. A cash-out refinance will replace your existing mortgage with a new loan for more than you owe on your house. You will receive the cash difference, which you can then use as a down payment on your new home.
â—¾ Home equity line of credit. Also known as a HELOC, a home equity line of credit is a revolving credit line secured by your home. It usually has a lower interest rate than other common types of loans, and its interest is typically tax-deductible.
â—¾ Sell investments. If you have an extensive portfolio of assets, you might consider selling some of them and using the cash for your down payment. The downside of this is that you will pay taxes on the capital gains and will lose out on the future equity you could build with these investments. Before you decide to go this route, talk with your financial advisor about the consequences prior to selling.
Figure Out the Logistics
Whether you are looking at homes for sale in Sun Valley before your current house is sold or you’re scrambling to buy because your home is already under contract, the logistics of moving can become very stressful. Planning for possible contingencies is an excellent way to reduce stress and always ensure you have a plan B. Here are some of the possible solutions to logistical problems:
â—¾ Secure a short-term rental. If you and your Sun Valley real estate agent are successful in selling your current home and you’ve not yet found a new house to buy, you can rent another home for a few months until you’re able to find, buy, and close on a new place to live.
â—¾ Rent out your current home. If you’ve settled on one of the homes for sale in Sun Valley but haven’t yet been able to sell the one you currently own, you can rent yours to cover your mortgage payments. You have the option of renting it short-term until it sells, or you can delay putting it on the market and rent it for a year or more. Rentals are in demand in the Sun Valley area, so you will likely not have any trouble finding renters interested in both short and long-term leases.
â—¾ Move belongings to storage. Your Sun Valley real estate agent will likely recommend you have your home professionally staged before listing it. This process involves removing most of your belongings to create a clean, open atmosphere. If you don’t yet have a new home to put your stuff in, you can pack it up and move it to a storage unit. This also gives you a head-start on packing and can be helpful if you need to move into a hotel or a smaller rental until you settle on one of the homes for sale in Sun Valley.
Find Out if You Can Afford to Buy Prior to Selling
Some potential buyers will be able to swing buying a new home before selling their current one, while others will not be so lucky. Before you work with a Sun Valley real estate agent to begin looking at new homes before selling yours, ask yourself the following questions:
â—¾ Can I afford to pay two mortgages? If so, for how long can I do so?
â—¾ Do I have enough assets to afford a down payment, or can I secure a loan for a down payment?
â—¾ Will I still have enough money for a down payment if I have to pay two mortgages for an extended amount of time?
If the answer to these questions is no, you may have no other option other than to sell your current home before you make an offer on a new one.
Work with an Experienced Sun Valley Real Estate Agent
The best way to navigate buying and selling Sun Valley homes is to work with an experienced agent who has handled these types of situations before. When interviewing agents, ask them how many times they’ve helped their clients buy and sell simultaneously and some of the solutions they helped them with. Tell them about your current situation and ask how they will help you decide on the best options. When you choose the right agent, your process will go much smoother and save you time, energy, and money.
Are you in a position where you need to buy and sell homes for sale in Sun Valley at the same time? Reach out to real estate agent April Smith for expert advice and guidance.
