new mortgage by selling your home

Can You Get A New Mortgage While Selling Your House

Gustan Cho Associates are mortgage brokers licensed in 48 states

This Article Is About Can You Get A New Mortgage While Selling Your House

Many homebuyers who plan on upgrading and/or downsizing to a new home often ask Can You Get A New Mortgage While Selling Your House:

  • The answer is YES
  • With proper planning and teamwork, you can purchase a new home and sell your current home at the same time
  • This is done often
  • There are countless reasons people sell their current home and purchase a new one
  • It can be due to space
  • People may have children and need extra space
  • It can be due to parents wanting their kids to enroll in a top rated school district
  • I can be to needing to downsize for homeowners who are empty nesters
  • Or it may be due to a job transfer that is above and beyond commuting distance
  • There are many options homeowners who are buying a new home and selling their home at the same time can consider
  • Just moving to a new home can be stressful
  • Buying a new home and selling your current home simultaneously does not have to be stressful

How Can You Get A New Mortgage While Selling Your House Without Stress

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A home purchase is most people’s largest purchase and investment in their lifetime.

  • There are many moving parts with the home buying process
  • Most people need a mortgage for a home purchase
  • The mortgage process normally takes 30 to 45 days
  • The lender will want countless documents and review your finances with a fine tooth comb
  • The mortgage process can be very stressful
  • There are many horror stories about borrowers who had things go wrong
  • Some borrowers even had a last minute mortgage denial while others had multiple closing delays
  • Things can go wrong during the mortgage process if the lender and borrowers are not on the same page
  • However, the mortgage process does not need to be stressful
  • Getting a new mortgage while selling your house does not need to be stressful
  • It can be a smooth process
  • The key in making sure the process is smooth is by setting proper expectations
  • Getting familiar with the  mortgage process and open communication is key
  • Educate and familiarize yourself in the overall home buying and mortgage process
  • Ask a lot of questions prior to and during the mortgage process
  • Learn about steps of the mortgage process from the time your real estate purchase contract is submitted to the clear to close

Choose a lender, realtor, and loan officer who you feel comfortable working with.

What Is The First Step To Take When Buying And Selling Home At The Same Time
First Step To Take When Buying And Selling Home

One of the decisions you need to make is Should I Buy Or Sell First?
  • There is no correct answer on whether to buy or sell first
  • It depends on the individual circumstances
  • Many homeowners cannot afford two mortgages at the same time
  • Others may be able to pay two mortgages at the same time but will put a strain on their finance
  • There are others who need to wait to buy first and sell late because they do not want to be in between homes
  • Homeowners who sell first before buying a new home do not have to worry about paying for two mortgages at the same time
  • If you do not have a lot of furniture and have a place to stay until you find a home to buy, this will be great
  • You do not have to be rushed to purchase a home in a hurry
  • You can take your time and be selective

Buying before selling your home gives the homebuyer a piece of mind because they know they will have a home to move into when they sell their current home.

Selling Before Buying: Moving Into Short-Term Rental

One of the major stress factors homeowners endure is when they have sold their home and need a short-term rental to move into:

  • Not knowing when and where your new home will be is one of the biggest stress factors homebuyers face
  • This holds especially true if the homebuyer have smaller children and pets
  • This also means moving furniture twice
  • If you sell your home first before buying, you may need to move your furniture into temporary story
  • During a sellers market, it may be difficult to get the perfect home for the perfect price
  • Bidding wars is very common
  • There are more demand for homes versus inventory
  • Most people who sell their homes first are under the assumption they will find a home for the right place in a particular geographic location
  • However, many found that it is harder to find that perfect home for the right price
  • Many who sold their homes have second thoughts about selling
  • One of the common regrets is doing a complete renovation including adding to the home with an FHA 203k loan versus selling their home and not finding anything they like
  • The country is experiencing a major housing boom like never before
  • With the lowest mortgage rates in history, there is a major housing shortage and demand for homes
  • Home prices are skyrocketing as well

This is difficult if you have heavy furniture such as a pool table, piano, or other fragile pieces that can easily get damaged if not handled with care.

Cost Of Temporary Housing Versus Paying For Two Mortgage At The Same Time

Sometimes it will cost more money and you will have more stress when selling before buying. Finding a temporary rental can be a challenge as well.

  • Many landlords do not want to cater to short-term renters
  • Many want at least a one-year lease
  • Movers can be expensive
  • If you sell your home first before buying, you will most likely pay for two moving expenses
  • Buying a new home first offers many more benefits to the homebuyer and their family
  • However, the negatives include paying for two mortgage payments at the same time
Maybe paying two mortgage payments at the same time may not be all that bad if you consider the expenses in being in limbo when you sell your home first.

Can You Get A New Mortgage While Selling Your House: Consult With A Loan Officer

One of the main factors a current homeowner buying a new house while selling the current home is to make sure they will qualify for a mortgage.

  • Can You Get A New Mortgage While Selling Your House?
  • Can You Get A New Mortgage While Selling Your House but the house is not sold?
  • Can You Get A New Mortgage While Selling Your House and how much can you qualify for?
  • You need to know where you stand
  • Maybe you may not qualify for two mortgages at the same time
  • The first step when buying a new house while selling your current home is to see where you stand with qualifying for a mortgage
  • Your loan officer will go over how much house you qualify for with just one mortgage or both mortgages
  • If your loan officer says that you would qualify for both mortgages at the same time, that is great news

If you only qualify for a new mortgage but need to pay off the current home mortgage, then you have no other choice but to sell your current home before buying your new home.

Can You Get A New Mortgage While Selling Your House: How Is The Housing Market
New Mortgage While Selling Your House

Now that you are pre-approved for a new mortgage on a new home purchase and should know whether you can qualify for just one or two mortgages, you need to research the current housing market.

  • I would start interviewing real estate agents who know the area
  • You can interview as many real estate agents as you like
  • Get referrals of real estate agents from your loan officer, family, friends, co-workers, neighbors
  • Research their online reviews
  • Search them on the internet and check out their online reputation

Tammy Trainor is an expert analyst of the housing market. Tammy Trainor has been studying the national housing markets for the past 20 years. Tammy said the following:

Time which season will be best to buy and/or sell your home.

When To Buy And Sell Your Home

Normally the late spring and early summer months is the buying season on homes.

  • You need to decide which season is best for you and your family
  • Families with school aged children may not want the school year interrupted so they may time listing their home accordingly
  • The winter months is normally slow
  • This holds true in areas and states where they have harsh cold winters with heavy snow
  • Winter months can be a good time to shop for homes
  • Homebuyers will not find too much competition and multiple offers during the winter months
  • If you decided to sell your home, start preparing your home to get maximum price prior to listing it on the market
  • A little window dressing will not cost you a fortune but will attract more buyers

Not only can you get top dollars by repairing/remodeling your home, but your home will sell sooner than your competition.

Can You Get A New Mortgage While Selling Your House: How To Prepare Your Home To Attract Buyers And Get Top Dollar

Every homeowner wants top dollar for their homes.

  • Doing some minor work on the house can do a world of wonders
  • You do not have to spend a fortune for your home to show well and attract buyers
  • It does take time to prepare your home to show well
  • Many of the things to get done are common sense tasks
  • For example, clutter is a definite no go
  • Rent a storage space and start moving things that you need but are not in use
  • This may be winter clothes, bikes, toys, furniture, or other items
  • Things you do not need, either donate it or throw it out
  • Decluttering and preparing your home to show well takes time
  • Months before you plan on listing your home, start preparing your home to show well
  • Many home seller will have a garage sale where they can get rid of most items they want to get rid of and get the benefits of making a few bucks
  • The exterior of the house is the first impression for buyers
  • Landscaping is key
  • Make sure the grass is mowed weekly
  • Paint is cheap
  • Paint areas where it is needed
  • A fresh coat of exterior paint will make a world of difference
  • Always choose a neutral color and nothing that sticks out like orange and/or purple
  • Make sure there are no broken windows
  • Make sure there are no holes or missing siding/brick
  • Any cracks in the driveway should be fixed
  • If have a blacktop driveway, a fresh coat of blacktop will cost you less than one hundred bucks
  • Get the opinions of multiple real estate agents and see what they suggest
  • Check out the competition
  • Drive by the listed homes that is comparable to yours
  • If you can invest hiring a professional landscaper, you will get a great return on your investment by mulching and planting shrubs/plants and/or flowers where needed
  • Make sure the garage is decluttered
  • Bikes, lawn equipment, junk all should be removed and stored at the storage, donated, sold, or thrown away

Having a presentable home will not only get you higher purchase offers but your home will sell faster than your competition.

Can You Get A New Mortgage While Selling Your House: Hiring A Listing Realtor
Hiring A Listing Realtor 

When you are ready to sell your home, you will need to hire a listing real estate agent.

  • Your listing agent will advice you of things to do prior to listing the home
  • Your listing real estate agent is your representative and acts on your best interest on your behalf
  • The real estate agent is a licensed professional who knows the area, the competition, the recent sales, what sells and what doesn’t, and has a goal to get top dollar for your home
  • But yet, your real estate agent will want to sell your home as soon as possible
  • The agent will discuss the recommended listing price
  • Listing price is normally based in recent comparable sales and comparable homes current listed but not yet sold
  • Listing agents do not get paid unless the home sells
  • The listing agent will advice you on how to stage the home for the least possible cost
  • The listing agent pays all costs for marketing materials
  • Depending on the real estate agent, the agent may hire a staging consultant and/or a professional photographer to start the marketing campaign
  • Listing agents network with other agents to find potential buyers who are looking for homes similar to your home

Listing agents network with other professionals such as loan officers, title companies, attorneys, contractors, home inspectors, appraisers, insurance agents, property managers. Listing agents can help refer you to just about anyone who they had prior experience and are reputable.

Hiring A Lender And Loan Officer And Getting Pre-Approved

Prior to shopping for a new home purchase, homebuyers need an iron-clad pre-approval letter.

  • Make sure you choose a lender and loan officer who are comfortable with
  • One of the biggest nightmare you will ever experience in your lifetime is hiring a loan officer who is incompetent, does not return calls/texts/emails, and issues a sloppy pre-approval
  • Talk to several loan officers
  • Interview them. Anyone with a 800 credit score, low debt to income ratios, no derogatory credit tradelines, and high down payment can get approved anywhere
  • However, lower credit score borrowers and borrowers with less than perfect credit may need to choose a specialty lender/broker that has little and/or no lender overlays like Gustan Cho Associates
  • Gustan Cho Associates is one of the very few national mortgage companies with no lender overlays
  • The majority of loan officers will be professional and know what they are talking about
  • However, who is the best loan officer that you feel comfortable with
  • Remember, you need to give your loan officer every aspect of your personal and financial information
  • Who is the person you can trust most
  • Your loan officer should be available to talk to you 7 days a week, including evenings and holidays

Once you decided on who your lender and loan officer is, the next step is to get qualified and pre-approved. Once pre-approved, it is time to shop for your new home.

Shopping For Your New Home

If you are buying your new home nearby where you are selling your current home, see if your listing real estate agent can represent you as the buyer’s agent. If you are moving to a new area and/or out of state, you will need a new real estate agent to represent you. You need to hire an experienced buyer’s real estate agent who knows the area. The agent needs to be an expert in the area like knowing the school districts, parks, community centers, data, property tax rates, and general real estate assessments. Real estate agents know where to refer their clients who need bridge housing if they need a temporary place to stay after closing on the exiting homes. An experienced agent is necessary when shopping for a home in a hot booming seller’s housing market.

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