Embarking on the journey to buy a new home while still tethered to your current one can seem like a daunting task. However, with the right strategies and knowledge, navigating this process can be smooth and successful. Here’s a comprehensive guide on how to buy a house contingent on selling yours:
Understanding Contingencies
Before diving into the process, it’s crucial to understand what contingencies entail. A home sale contingency is a clause added to an offer, stipulating that the buyer will only proceed with the purchase if their current home sells within a specified timeframe. This clause offers protection against the financial burden of carrying two mortgages simultaneously.
Working with an Experienced Agent
Hiring a knowledgeable real estate agent is necessary when buying a house contingent on selling yours. Find an agent skilled in handling these types of transactions, as they can provide valuable insights and guidance throughout the process. Ensure they are well-versed in negotiating and familiar with navigating contingencies effectively.
Preparing Your Current Home for Sale
To accelerate the sale of your current home, ensure it is market-ready. Invest in professional staging and high-quality photography, and complete all necessary repairs to enhance its appeal to potential buyers. Pricing it competitively and strategically can also expedite the selling process.
Crafting a Competitive Offer
When making an offer on your new home, strive to make it as competitive as possible. Consider offering a higher price than competitors, covering some closing costs or allowing the seller extra time to move out. Including a kick-out clause can also reassure the seller while protecting your interests.
Exploring Alternative Financing Options
If removing the home sale contingency is necessary, consider alternative financing options to bridge the gap between buying and selling. Bridge loans, home equity lines of credit (HELOCs) or adjusting your down payment strategy can provide flexibility and alleviate financial strain.
Staying Proactive and Flexible
Throughout the process, remain proactive and flexible. Stay in close communication with your agent, monitor market conditions and be prepared to act swiftly when opportunities arise. Keep contingency plans in place to mitigate potential setbacks and navigate unexpected challenges.
