So you’ve found your dream home. Everything seems to be lining up for your life. But there is an obstacle for you to reach your dream: You did not sell your home yet. You may feel overwhelmed trying to sell your home. In this article, we hope to help you figure out how to move if your house hasn’t sold yet in Kansas.
Moving is very difficult, it may be almost unbearably difficult if you are finalizing the process of selling and buying a home at the same time. This can be especially difficult because mortgage providers including have rules about getting a second mortgage while you still own your home. If you want to secure an additional mortgage, you will have to clear a few hurdles:
- The FHA
- Fanny Mae
- Freddie Mac.
How to Move if Your House Hasn’t Sold Yet in Kansas
You need to meet many qualifications to qualify for a second mortgage through the FHA.
You cannot move just because you want to, you need to have a good reason to move right away, and only after your current house has sold. Some of these reasons can include:
- your family needs a larger space
- you are separating from your spouse
- for work purposes.
There are many additional restrictions as well. For instance, you cannot owe more than 75% of the value of the first home. You must do your homework before assuming you will qualify for an additional loan through the FHA.
Asking family can be another route, so long as you put everything in writing.
If you borrow money, agree to pay it back in full upon the sale of your first house. Whenever you borrow money from family, you want to set clear terms and follow these terms closely.
Of course, borrowing money from family can introduce some stress. If you think borrowing money from a family member could damage a family relationship, you might want to look for a different way to secure the financing you need.
A bridge loan, or a “wrap” loan, can help “bridge the gap while you attempt to cover two house payments.
These types of loans will consolidate your mortgage payments, and combine them into one interest-only payment. These are typically short-term loans, lasting 6 months to one year.
Lenders have different requirements, but you usually need great credit and you must be financing less than 80% of the value of both houses.
Worst case scenario, you can talk to your boss or plan administrator about borrowing from your 401k.
In many scenarios, borrowing from your 401k produces tax penalties. Make sure you understand how the tax penalties will work, and pay back the loan after the sale of the original home. This may not be an option for everyone, but it is something to look into.
Try to offer the seller of the second home, the option to rent it back from you for a few months.
In many situations, the buyer may not be set to move out of their home upon sale. After all, it usually takes 2-3 months to buy a house.
Depending on their situation, they might love the idea of being able to stay in their home while they shop for a new one. In these situations, you can rent the house to them until they are set to move. The rent can help to cover the costs of the two mortgages.
Add a contingency in your offer allowing you to close on the new home, only after your home has sold.
If your home is new to the market and priced well, it should quickly. This can be used as leverage for the sale. Present this to the owners of the second home, along with your offer. Ensure them that the closing won’t be delayed and that you agree to close in a certain amount of time.
Whether you are looking to buy or sell, we can help you with all of your Real Estate needs! Fill out this short form, or give our office a call today! (316) 413-8314