If you’re a homeowner ready to make your next move but wondering how to juggle selling your current home and buying a new one, you’re not alone. The challenge of navigating finances, timelines, and market conditions can be daunting. That’s where real estate professionals and innovative “Buy Before You Sell” programs come into play.
Judy Jernigan, founder and team lead of Sage and Grace Realty Group sat down with and explored this topic in depth with Derek White, the “Buy Before You Sell Guy,” a local mortgage lender and a seasoned expert in these specific niche real estate solutions.
You may be able to have two mortgages at once, that’s the simplest path forward. And that path could include a loan recast after selling. Or, you may choose to sell, move in with friends or family, then buy. Or, you may be able to close on both homes in the same week. Talk over your options with us. What many find makes the most sense are “BBYS” programs. Schedule time to chat with us.
What Are “Buy Before You Sell” (BBYS) Programs?
These programs are designed for homeowners who need to sell their current home to purchase their next one. Instead of traditional home sale contingencies, which can make offers less competitive, these programs offer bridge financing and other tools to streamline the process. Key features include:
• Bridge Financing: Leverages equity in your current home to fund a down payment for your next home.
• Debt-to-Income Solutions: Removes your existing mortgage from the debt-to-income calculation, making it easier to qualify for a new home loan.
• Binding Contracts: Some programs provide a guaranteed offer on your current home, ensuring compliance with lender guidelines and eliminating home sale contingencies.
Why Consider These Programs?
The advantages of “Buy Before You Sell” programs go beyond convenience:
• More Competitive Offers: Without a home sale contingency, your offer on a new home is stronger and more likely to be accepted.
• Better Presentation for Sale: Moving into your new home before listing your old one allows for cleaning, staging, and showing your property in its best light.
• Financial Flexibility: These programs free up funds from your home’s equity, helping you secure your next home without the stress of juggling two mortgages.
Costs and Considerations
While these programs provide flexibility, they come with costs. Typical fees range from 1.5% to 3%, depending on factors like home value, program specifics, and timeline. However, these fees are often offset by the increased value you can achieve when selling a staged, vacant home and the savings from competitive buying opportunities.
I.E. we often negotiate a much lower purchase price on your next home by being able to make a cash offer with a quick close. That can offset the program costs entirely. Then, being able to see your existing home clean and staged with very easy showings usually means it sells faster and for more money... agani, this along can offset the BBYS program costs entirely. Plus, make your move and your life easier.
Each program has unique criteria and timelines for selling your current home, usually ranging from four to six months. If the home doesn’t sell within the allotted time, some companies will buy it at a predetermined price, ensuring homeowners are not left in limbo.
Tailored Solutions for Every Homeowner
Whether you own a single-family home, condo, or investment property, there’s likely a program that fits your needs. Companies like Knock, Up Equity, HomeLight, and Calque offer varying levels of support, from simple bridge loans to comprehensive home sale guarantees. Each has its own guidelines, pricing, and areas of expertise.
• Knock: One of the longest-standing players, offering flexible solutions for a variety of property types.
• Up Equity: Ideal for homes in the middle price ranges and those needing more flexibility in lending criteria.
• HomeLight: Offers streamlined options for single-family homes in metro areas.
• Calque: Provides affordable options for homeowners with unlisted properties, focusing on securing contracts for smooth transactions.
Each company has unique features, timelines, and pricing structures, and it’s critical to compare them to find the best fit. There's where Derek White comes in, his speciality is staying on top of each of these companies' processes - as well as all other options - and helping you and your Sage And Grace Agent compare the pros and cons and determine the best path forward for you and your family.
Is It Right for You?
“Buy Before You Sell” programs are not one-size-fits-all. Homeowners should carefully weigh the costs and benefits of these solutions against their individual circumstances. Working with a knowledgeable agent and a real estate financing expert can make all the difference in finding the right fit.
When you’re ready to start planning your next move, these programs could be the key to unlocking a smoother, more efficient buying and selling experience.
Schedule time to chat with us to learn more and see what solutions are right for you.
Sage and Grace Realty Group team agents specialize in providing top-notch real estate services as well as helpful local information in Brookhaven, Buckhead, Sandy Springs, Chamblee, Decatur, Dunwoody, Virginia Highland, all the surrounding areas and worldwide, ensuring our clients receive the best possible advice for investing, buying and selling in today’s market.
Information provided by Derek White, the "Buy Before You Sell Guy" >>Connect with Derek on LinkedIn<<
