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Old 01-24-2011, 06:08 PM   #1
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Buying/Selling a house....frustrated


Long story short, we found the home of our dreams. We entered a contingency contract and had to sell our home. 6 months later we had a contract on our home and it fell through. Someone then bought our dream home.
I don't know how people buy a house if the have to sell theirs first. Do people pay two mortgages? Or do they sell theirs and then just say..."well we'll just pick the best one that's for sale"? I don't think most people pay two mortgages which leads me to believe people are not that picky when it comes to buying a home.
So I think we're stuck in our house for quite a while until we figure out how to play this game. It took 7 years for our dream house to come on the market. Maybe we'll sell our house and live in a rental for another 7 years until we can pounce! Frustrating.

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Old 01-24-2011, 06:15 PM   #2
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Buying/Selling a house....frustrated


it wasn't always like that, when the market was active it was much easier, and even if you had to take out two morgatages or a bridge loan it was a lot less risky because there were so many buyers

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Old 01-24-2011, 06:18 PM   #3
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it wasn't always like that, when the market was active it was much easier, and even if you had to take out two morgatages or a bridge loan it was a lot less risky because there were so many buyers
True, but that also means there are lots of buyers for the house you have your eye on so it's a wash. It's always a race to sell your house before someone buys the house you want. Seems like a risky business no matter what the market is like if that makes any sense.
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Old 01-24-2011, 06:38 PM   #4
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Buying/Selling a house....frustrated


yes, some people (apparently a lot more than you would believe) do carry mortgages on 2 homes at the same time.


A lot of them that I have known saved for a considerable time to be able to do this. If their old house did not sell within the time they figured for, they run out of money.

Some people can afford to carry two mortgages straight up.

A lot of people will carry the two mortgages but rent out hopefully covering the expenses of the old house while it is for sale.

Some people do as you suggest; sell the old house, rent house or apartment while searching for the new house.

and then there are the people that contract to buy the new house and somehow don't realize what is about to happen when both mortgage payments become due. You don't want to be around people when they first realize that.

Of course, to do anything where there are two outstanding mortgages at the same time, the person has to be able to qualify for the mortgages so there is often a bit of "slap you in the face, you can't afford two mortgages" reality.
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Old 01-24-2011, 07:21 PM   #5
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Buying/Selling a house....frustrated


I have had clients in all of the above situations. Best advice is to sell first get as long a closing date as possible then purchase. If you purchase first then you end sometimes having to under price your house to get it sold. Or yes carry both mortgages ...
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Old 01-25-2011, 02:56 PM   #6
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Buying/Selling a house....frustrated


Where I live, decent houses that are priced aggressively sell very quickly and often with multiple offers. People have a broad perception that real estate will continue to decline, so they want a some of that depreciation priced in at the outset. Sellers are mostly unprepared to price like that so there is a bit of a standoff between buyers and sellers and not that many deals are closing. There is actually a bit of pent up buying desire and each time something good comes a long it is a feeding frenzy. Not saying that is your situation, just what is happening here.
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Old 01-25-2011, 11:17 PM   #7
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Buying/Selling a house....frustrated


Sell your house, move into a rental, get yourself some plans that you like, hire a builder, and away you go. You will likely never step out of one house into another.

If all goes right, I will be moving out of state in a few months. I plan to rent something (preferably a house) while my house sells. After that I will buy a new one.

I will prolly take a hit on the sold house (I'm in a not so depressed market), but I should be buying into a very depressed market where I will buy the new one, so maybe I will come out ahead.

I built this house 4 years ago and one thing that I know for sure, what I end up buying will be half the house that I am leaving. I put so much into this house. It'll be a sad day for me.
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Old 02-26-2011, 11:44 PM   #8
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Sell your house, move into a rental, get yourself some plans that you like, hire a builder, and away you go. You will likely never step out of one house into another.

If all goes right, I will be moving out of state in a few months. I plan to rent something (preferably a house) while my house sells. After that I will buy a new one.

I will prolly take a hit on the sold house (I'm in a not so depressed market), but I should be buying into a very depressed market where I will buy the new one, so maybe I will come out ahead.

I built this house 4 years ago and one thing that I know for sure, what I end up buying will be half the house that I am leaving. I put so much into this house. It'll be a sad day for me.

im gonan say half of this..

sell your house, then just RENT a BASIC house.

then when u find your dream house, put a few offers on it.. and hopefully you will get it..
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Old 02-27-2011, 11:34 PM   #9
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I've known a lot of people, especially in this economy, who have sold when they had the chance and are renting until they find something that fits with their family.
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Old 02-28-2011, 04:07 PM   #10
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The best part of renting while you are looking is (if you can afford it) you can stay in your rental for a month after you close on the new place, then paint and prep the new place, before you have to move in all your stuff.

If you plan to be actively looking while you rent, try to get the shortest lease you can, or better yet get a month-to-month rental, even if it means you have to pay a little extra. It's much cheaper in the long run to pay a little extra rent, than to try to get out of a lease early in most cases.
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Old 02-28-2011, 07:28 PM   #11
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Buying/Selling a house....frustrated


I paid two mortgages for almost 2 years. One on the market the other one lived in. Lost so much money don't want to get into it.

Two years ago my wife and I bought our dream home. We thought about selling the house we were in but realized we would lose $50,000. We decided to move into the dream home and rent out the other home. 2 years later best choice we ever made.

The house we got was half price from a 2006 sale.
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Old 03-01-2011, 03:52 PM   #12
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Buying/Selling a house....frustrated


I think the best approach is to spend the time waiting for the right house to come along saving towards it, then you can make a larger down payment, reduce the new house payment as much as possible to make it easier to afford 2 payments while the old house is on the market... Or if you're achieving a low current housing payment through rental, then you can use the down payment to better ensure financing can be acquired and/or make a better offer than competing bids.

Or you could use the saved money to buy something with potential and make it into the house you want.
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Old 03-01-2011, 04:16 PM   #13
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Buying/Selling a house....frustrated


I'm at the age where most of my friends are selling off their first homes and moving onto their long-term homes. For us, we knew there was no way we wanted to go the two mortgage route, even though the bank said we could (they are crazy). We listed our house and didn't even start looking at others until we started getting some serious interest from buyers. Then, we went out and got an idea of what was out there. We had an offer come in, accepted and they buyer was willing to delay closing if we needed more time to close on our other house. Luckily, the house we really wanted was sitting vacant and we were able to work a deal in short time. We closed the sale of our old house at 11am, grabbed a quick lunch, then closed on our new house at 1pm. Meanwhile, all of our worldly possessions sat in a U-Haul parked in the street in front of the new house. We still joke when we drive past the McDonald's where we ate lunch: "that's where we stayed when we were homeless."

One of my friends bought a +$500K house for a tad under $300K. It was built for the "parade of homes" and was never lived-in. The builder went bankrupt and everything was going dirt cheap. He bought it because of the deal he got, and then tried to sell his home. It didn't happen and he paid double mortgage for about 9 months before he switched his old place to a "lease to own" sort of deal. Not something I would be particularly comfortable doing, but I guess it's better than just making it a rental.

Speaking of rentals, a former neighbor at my old place bought a new house and tried to just keep the old one as a rental. The first tenant paid the first and last months' rent and that was it. Took 6 months to get them evicted. They tried to find new renters but eventually the house was foreclosed.

Another friend bought a new house, confident that he would be able to sell the existing home. He signed on the new house before he even listed his house. Didn't matter, it took him about 10 days to sell his house.

All of this was 2009, AFTER the collapse of the market in 2008.

I have a very good friend who is in the same situation as the OP. They found their dream house, put in an offer contingent on selling their existing home, and are trying hard. They were able to extend the contract twice, because there have been no other offers on the house he is trying to buy. They don't want to float 2 mortgages, and I think that's the smart thing to do. If they lose the house they want, there will be others.
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Old 03-21-2011, 11:11 AM   #14
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Even if you have to pay 2 mortgages for few months, its still probably worth it.
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Old 03-21-2011, 03:30 PM   #15
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We closed the sale of our old house at 11am, grabbed a quick lunch, then closed on our new house at 1pm. Meanwhile, all of our worldly possessions sat in a U-Haul parked in the street in front of the new house. We still joke when we drive past the McDonald's where we ate lunch: "that's where we stayed when we were homeless."

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