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I was wondering how most people handle this. We need to sell 3 houses and buy 1. 2 out of the 3 are occupied by us. Which means, no matter what, we have to sell our house and then buy something at the same time. I was curious how people do this. I'm assuming the banks will require one loan closed before opening a new one. Help! I've never had to do this before.
More info.
2 houses are located out of state. 1 is occupied by my MIL, the other is empty. We plan on selling the empty one first and then using the proceeds for the new purchase.
The 3rd house is located in my state, that DH and I live in. We are buying a new house here and moving MIL in with us, so moving her is going to take some time as is getting the house she lives in cleaned up and ready to sell.
You sit down with a lender, and hash it out. You can absolutely have multiple open mortgages at once.
The lender's basic ? is:
1. can you afford to own your current home AND the new home (own = make mortgage payments on)?
2. where's the downpayment coming from?
You can - and should - have that conversation with the lender NOW, before you do anything.
If we take MIL out of the equation - you're not relying on equity in her house, nor her income - then it's much simpler of course.
You're absolutely right to plan on selling the vacant house. If it's got a mortgage, you definitely need to do this ASAP after talking to lender.
Thanks. So, yeah, no we can't afford to carry two mortgages unless we can close on the sold house in the period before we close or before we make the first payment on the new house. Ugh. So much fun.
The down would come from the selling of the MIL house. She'll have partial ownership also, which we're fine with since she'll be living there, paying for part of it, while we care for her. Unfortunately, we can't take MIL out of the equation (prices have gone up too much here). Vacant house has no mortgage so it'll be cash in hand. Thankfully, MIL is aware and onboard; granted she could change her mind.
You place an offer, contingent upon you selling your home on the house you want - for a reasonable period of time (say 60 days). Then you list the home (or homes) you own (and price it/them to sell), and market them appropriately, with an aggressive agent.
I would not advise my lender and let the chips fall where they may.
People do this all of the time - even in a seller's market, you can have a contingent offer accepted if it's a really good offer . . .
You have to have a "can do" attitude about it and be confident that it will all work out like clockwork.
The answer depends on whether the kind of house you want to buy is common and frequently available, or unique and a needle in the haystack that will require an extensive search. If it’s common, I would list and get contracts on the homes to be sold, and then make an offer on the new house, contingent on the closing of the home sales. If it’s a rare find, you probably should find it first (before selling the home you live in now, at least) and make a strong contingent-on-sale offer, then list your home aggressively to sell it quickly. Note that this 2nd option is not the most cost-effective option as you’ll likely pay more than if you would without a contingency, and you may not get as much for your house as you could if you had time to be patient and wait for the right buyer to come along and fall in love with it. It does give you the benefit of getting the perfect house though because you won’t be scrambling with limited time to find it.
Also, OfferPad and the other ibuyers will usually let you choose your closing date also, some may lease back to you as well.
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