Good Morning and Welcome to your next episode of Coffee with Cristi!
I am Cristi McGowan, Broker for Waco Home Team and WHT Properties.
Your Home Run Realtors!
Thanks for watching!
This morning’s question is most for Buyer’s who currently OWN a home: Do I need to sell my home before I buy my next one?
The answer is Yes! And No! Well…. It depends.
Here’s the scenario where your answer is critical, and a creative solution is needed.
In a competitive market, which is based on the price range you decide to own in – the higher the price point, the less competitive, given that you are well over the median price for your market…..
So, In a competitive market, it is VERY DIFFICULT to WIN your dream home if the loan you need to purchase is contingent on the money you would receive from the sale and funding of your existing home. Realtors call these type of offers “Contingencies”.
The only way, in my years of experience, that I have seen an offer that is a contingency be accepted in a competitive bid situation, is when the offered price is significantly higher than the other competing offers.
This could mean that you are having to pay more than you need to for the home – If this is important to you, then the answer to the question “do I need to sell my home first” is YES!
If this is not an issue for you and your motivation is high… meaning you are totally in LOVE with the home, and/or are desperate to move, or whatever your situation is… then, the answer is NO!
WHY does a contingency put you, as a qualified buyer, at such a disadvantage.
1 – The seller’s timeline for closing and moving could require a more dependable closing date
2 – The seller’s closing and funding may be critical for the purchase of their next home
3 – If you do sell your current home in a timely manner, who’s to say that that deal won’t fall apart near the end, creating a snowball of delayed or canceled closings, that I have seen go 5 home purchases deep, and across the country!
These are just a few of the many, many reasons why accepting your offer with a contingency is such a huge risk for the seller, and a disadvantage for you as a buyer.
WHAT can you do about it?
Waco Home Team has options for you! We will cover those in another episode, so stay tuned, or check back on this blog post where we will add the link to that episode soon!
Thanks for watching, Save Money and “Save your Butt” by Hiring a Realtor!