How Do I Get a Buy Before You Sell Mortgage? (Bridge Loan)
Navigating the journey of selling your current home and stepping into a new one can feel like a daunting balancing act of timing and finance. If you’ve ever worried about avoiding the situation where you end up paying for two homes at once or having nowhere to live, you’re not alone.
A bridge loan, often called a “buy before you sell” mortgage, could be your key to streamlining this transition.
In the following sections, we’ll guide you through the challenges you may encounter and explore how this financial tool can help to provide a seamless home transition. We’ll also share details about HomeLight’s Buy Before You Sell program, a modern solution designed to simplify the entire process.
DISCLAIMER: This post is intended for educational purposes, not financial advice. If you need assistance with a bridge loan or “buy before you sell” mortgage, HomeLight encourages you to reach out to your own advisor.
Understanding the ‘buy before you sell’ dilemma
Moving into a new home is exciting but can also be complicated, especially when it comes to selling your current home while buying a new one. The idea of “buy before you sell” often brings up a lot of questions and concerns for homeowners. Let’s break down this challenge and explore how it can be managed.
The challenge of buying and selling simultaneously
Buying a new house while selling your current one sounds simple on paper, but in practice, it’s a tightrope walk. Here are the two main challenges homeowners face:
1. The timing conundrum: It’s a rare occasion when the sale of your existing home and the purchase of your new one sync up perfectly. Often, there’s either a gap where you’ve bought the new house but haven’t sold the old one, or you’ve sold your existing home and haven’t yet secured your next one. This misalignment can lead to scenarios where you’re temporarily homeless or carrying the financial burden of two homes.
2. Financial juggling: Most homeowners rely on the proceeds from the sale of their current home to finance the purchase of their next. When these two transactions don’t align, it can create financial strain. You might find yourself in a situation where you’re expected to make a down payment on the new home while still paying the mortgage on your current home. This juggling act can strain your finances and increase stress during what should be an exciting time.
