Do you buy a new home or sell your current home first?
In today's real estate market with low inventories at almost all price points other than the $1 million to $2 million range the question asked by many potential home buyers is "Do we buy first or do we sell first?"
It is highly competitive out there buying a house today and for sellers when they list a home there is a big chance they will get multiple offers to select who the next owner of their home might be if it is correctly prepared for sale.
I decided to take this question to Mike Graff of Prosperity Home Mortgage, LLC to see what he suggested and if he had any answers.
So two suggestions from Mike, 1) Make an offer conditional upon the sale of your home, as Mike admitted this is often rejected by sellers who have just listed and are unwilling to take a chance on you selling your home quicklyas well. 2) Leverage the equity in your home, if you have it, using a Home Equity Line of Credit to buy the new home. This is conditional upon you being able to afford both loans plus the mortgage on the new propterty till you sell your current home.
Another suggestion we have used in the past to good effect, which can be a little risky, is to ask the seller if they are comfortable with a long settlement date. The settlement date can be moved up if your house sells quickly and all parties agree. The seller of your new home may be in the same position you are and have not yet found a home to buy, or even have purchased a new construction home and have a delay till settlement due to construction.
Having the right agent to represent you as a buyer is important. Your buyers' agent can discover what terms are most beneficial to the seller. Many buyers today mistakenly think using the listing agent is going to help them win a competitive offer situation, possibly saving the seller money or influencing the listing agent to put a more favorable light on their offer. But what these buyers don't understand is the listing agent has a fiduciary duty to the seller not to you the buyer. The commission has already been agreed upon in the listing agreement and it is far better to make sure you have a buyers agent whose fiduciary duty is to you the buyer to represent and protect your position throughout negotiations and through to settlement.
An agent earns their commission not in finding a home or getting an offer but in making sure all the details of the agreement are handled correctly after the agreement becomes a contract and that all parties uphold their end of the contract as per the agreement, including those outside of the contract such as inspectors, title companies and mortgage lenders chosen by you the buyer.
If you are looking for help buying and selling on and around the Main Line then call Nick Vandekar, Long & Foster Real Estate, office 610-225-7400, cell 610-203-4543,(best number), email Nick@VandekarTeam.com.