Knock Home Swap - Buying a New Home Before Selling the Old

By
Real Estate Agent with RE/MAX Properties, Inc., ABR, GRI, SRES

 

 

Home listing inventory is the lowest it has been in a very long time in Colorado Springs, CO.  One reason why? Many current homeowners are nervous to put their home on the market with the uncertainty of where they will go.  If they put their home up for sale and find a home to purchase, writing an offer contingent on the successful sale of their existing home makes their offer less attractive when stacked against the multiple offers the seller is likely to receive. 

Even if the homeowner decides to build new, many builders are requiring the contingent property be under contract early on in the process resulting in the seller/buyer having to rent for months until the new home is ready and with climbing rents in our city and the issue of moving twice, this is also not a great option.  Unfortunately, not many of these homeowners can qualify for a bridge loan.  Homeowners are also worried they may not find a home they like to offer on after their home sells.  All of these challenging factors are resulting in many homeowners remaining in there current property, frustrated, with limited options.

Knock Home Swap is now available for select brokerages in Colorado Springs and should alleviate some of the stress homeowners feel with this challenge of selling/buying in such a competitive market.  With this program, homeowners are able to purchase their new home before selling their existing home and Knock provides them with the down payment needed for the new property (up to 20%).  There are limitations as the loan on the replacement property - Conventional Loan Only and cannot be an FHA, VA, or Jumbo loan. 

Knock will provide up to $25,000 upfront, toward home prep funds for the old home and also provide up to six months of mortgage payments in the event the home doesn't sell right away.  Everything is paid back to Knock out of the seller's proceeds at closing and charged at 0% interest. The list price cannot exceed $750,000 for the old home and Knock prefers there is about 30% equity in the property.

The cost to the homeowner?  A 1.25% convenience fee that is calculated/based on the purchase price of the new home and can be rolled into the loan of the new home or brought to the closing table.  

Although this program may not be ideal for everyone, I have become certified with Knock Home Swap as it will open up options for many homeowners. Hopefully we will see an increase of property listings in our real estate market in Colorado Springs now that this program is available.

Is Knock Home Swap offered in your state?  Any feedback on how it has worked for your clients?  

 

Patricia Beck – Selling Colorado Springs Homes

 

Comments (1)

Joan Cox
House to Home, Inc. - Denver Real Estate - 720-231-6373 - Denver, CO
Denver Real Estate - Selling One Home at a Time

Patricia, this would seriously help our buyers and alleviate the stress in this crazy market.   We are seeing hard money loans so the buyers can be non-contingent.  Hope you are doing well! 

Jan 27, 2021 06:08 AM
Patricia Beck

I agree Joan!  I think this is now available in the Denver area as well.  

Jan 27, 2021 06:59 AM