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Which comes first: Buying or Selling?

Deciding whether to buy first or sell first is a big decision. While we can’t make the decision for you, we can provide you with information that can help you make the best decision for your own personal circumstances.

Buying Before Selling

It may seem to be ideal because it gives you a lot of time to look for the right home and update it before you move in.

BUT you must be willing and able to carry two mortgages: Both the lender and the seller will want proof of this.

In a seller’s market, when homes are selling well, it is easier to assume your home will sell quickly.

BUT this can be risky. If your house does not sell quickly, unless you have enough cash easily available, you may be stuck paying two mortgages.

In a buyer’s market when you know it may be harder to sell your old home, you could ask for a Contingency Clause in the purchase agreement that says you will buy the new home contingent upon the sale of your current home.

BUT it is rare that a seller will even consider it.

As a seller, you could ask for a Contingency Clause saying that you will sell your home contingent upon finding another suitable property to buy.

BUT it is rare that your buyer will even consider it.

As a buyer, you can sometimes ask the seller for “a Right of First Refusal” to give you time to sell your house. This would add a clause requesting that your offer be considered first if another acceptable offer is made.

BUT it’s rare that a seller will accept that because most sellers want a firm commitment to buy, not just a maybe.

Selling Before Buying

Selling first is the most common choice because most people just can’t carry (or qualify for) two mortgages. By selling first, it keeps you from under or overestimating the money you’ll get from the sale of your home so you are sure you can afford the new house.

If your house sells quickly and you do not have a new place to go to, you may be able to “rent back” your old home from the new owners for an agreed-upon amount of money and time while you finalize the purchase of your new home. BUT, most buyers want to move in as soon as they close.

Concurrent Buying and Selling is the safest, as long as you accept that you may not be able to close on both homes on the same day. You may only be able to buy and sell around the same time.

Only you can decide which scenario you’re going to try for. With your lender’s financial recommendations and our professional guidance, we can help you through what can be a stressful process so you come out on the other end satisfied with both the sale of your old home and the purchase of your new one.

Let’s discuss your personal options and see if we can pin down which scenario is going to work best for you.

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