You are ready to buy your dream home! 

But wait a second. 

How will you use the proceeds from selling the current home to finance your future home? 

How do you prevent an expensive homelessness gap in between the moves? 

It is possible. There doesn't have to be a gap, and you can move with one trip of the moving truck. Done correctly, this process does not have to be a cause of stress. 

Let's call this coordination a "sale/purchase." 

There are some more complicated methods of handling sale/purchases that involve lease backs or renting a property before moving. For the sake of brevity, I am going to stick to the basics. 

There are 3 popular ways to structure a sale/purchase. 

1) Sell the old house, look for a new one.
2) Find your dream home, and then put your house for sale.
3) Get your house ready to sell, and then start looking for the new one.

Let's take a closer look at each.

1) Sell the old house, look for a new one.

This is as straightforward as it gets. Market your home, put it under contract, successfully close on it, and then, once the proceeds are in your bank account, go find your dream home. This option comes with a gap of at least a month where you have already sold and moved out but still haven't chosen a new home. A lot of folks think this option is their only option. Luckily that is not the case. This is, however, the most direct option because there are less moving parts to negotiation with stakeholders. 

Before moving on, it might be helpful to know the basics of The Buyer Procss. There is quite a bit that goes into this process and escrows typically last 30 to 45 days. Due to the extended amount of time, among other things, you and the other party sign a Real Estate Purchase Contract (REPC). Most buyers that are obtaining financing put three conditions on this contract: inspection, attorney review, and mortgage contingency. For the next two options, a fourth condition is applied where the REPC is subject to the sale of the buyer's residence first. 

2) Find your dream home, and then put your house for sale.

You may be hesitant to officially put your house on the market until you are under contract on your next home. You are not alone with these feelings.

This second option allows you to submit an offer on your dream house that is contingent on the sale of your current house. This condition includes a clause where you promise to have the property on the market by a certain date. Most sellers will respond to this with a time clause. This adds a bit of uncertainty, but it is common practice and usually is successful.

Don't forget, there is work to be done if you are about to list your home for sale. Neglecting the pre-listing process could result in a lower sales price and take a longer amount of time to sell. 

Once your offer is accepted on your dream home, it's go-time for selling your old house! Make your home easily accessible to potential buyers to sell quickly. 

Read More About Common Seller Mistakes Here

Next, your current home will go under contract. Your agent will design the dates to close simultaneously. This might stagger a day, but we plan for that in the contract by maintaining possession of your current house for 72 hours after closing. (It is tough to do longer than this without having a leaseback.) Ideally, we negotiate possession of your new house upon recording. This allows you to have a couple days of possession of both homes creating a great moving situation for you. 

This method works best in a buyers market. It is rather easy to convince a seller to accept your offer (sometimes without a time clause), even if you still have to sell your house.

3) Get your house ready to sell, and then start looking for the new one.

This option is similar to option 2. The only difference is that your house is already on the market, or more ideally, already under contract when you submit your offer on your dream home. 

Option 3 is the most common option for such a situation. You absolutely can and should tour homes before your house goes under contract. You should know the market and what is available. 

The pros and cons of option two and option three have everything to do with market conditions - a buyers market versus a seller's market.

In a seller's market where there are more buyers than sellers, you as a buyer are competing against many other buyers. Sellers know it is a strong market and hesitate to take what they may view as an inadequate or difficult offer.  In a hot seller's market, these contingencies will likely be difficult to negotiate with a seller because other easier offers are probable. 

Bottom line: Research a competent, knowledgeable agent who keeps your needs in mind and has finesse when negotiating contracts. A great agent will understand your concerns, ease your mind, and make the process as convenient as possible. 

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