Can You Buy a New Home Before Selling Your Current One?

By Cory Lauer

Originally from central Ohio, Cory graduated from the University of Mount Union in 1999 and moved to Southwest Florida. In 2001, he launched his real estate career, earning “Rookie of the Year” at a top local firm before opening his own brokerage in 2004.

In an ideal world, the sale of your old home would line up perfectly with the purchase of your new one. But in reality, real estate transactions don’t always go that smoothly. You might find your dream home before your current one sells, or worse, sell your home and have nowhere to go.

Whether it’s due to rising interest rates or longer days on the market, figuring this out is easier said than done. That’s why I’m sharing this video today to provide you with some practical options to make this as easy as possible.

1. Sale contingencies and delayed closings. One option is adding a sale contingency to your contract, meaning your new home purchase depends on selling your current home first.

Depending on the market you’re in, keep in mind that a seller might not be too enthusiastic about this because you’re essentially asking them to wait while you hope that your home goes under contract.

If you’re already under contract, you’re hoping everything goes smoothly on that property so you can close on time. However, asking for a delayed closing when you already have a solid contract or offer on your home might be easier for a seller to accept.

2. Bridge loans and lease-back agreements. A bridge loan allows you to make a non-contingent offer on a new home. However, keep in mind that, as the name suggests, bridge loans often come with higher interest rates and generally a shorter term.

A lease-back allows you to sell your current home while structuring a short-term lease that lets you stay in the home after the sale. This way, when the funds are available, you can apply them towards the new home. It also gives you time if you have a rehab project to complete in the new home or if you’re making a cross-country move,

3. Explore alternative solutions. If those options don’t work, there are other creative ways to make the transition smoother. Companies like Flyhomes, Orchard, and Knock offer programs that help you buy before you sell.

Keep in mind that these companies come at a cost, so there will be a premium for their services. You could also consider one of the many “iBuyer” type companies or investor-type companies that will purchase your home in a matter of days. However, they often seek a discount of 20% to 25% off the true value of your home for convenience. But perhaps that option works for you; every situation is different.

Bonus Tip: Rent it out. If you can manage it, consider not selling your home at all. Instead, rent it out and build yourself some wealth. Use the rental income to offset your new mortgage.

While buying before selling can be convenient, it’s not always the best financial move. Carrying two mortgages at once or relying on a quick home sale can be risky. That’s why working with an experienced real estate agent is crucial. Expert guidance from a real estate professional will help you determine the best approach for your situation.

If you’re interested in selling your home, call or DM me at (239) 444-6100 or cory@thecorylauergroup.com. I’ll help you make the best decision based on your unique situation. And remember, only the sunset covers Southwest Florida!