3 Smart Ways to Buy a Home Before You Sell

I had a client last year call me in tears because they were so frustrated with the process of buying a home and selling their current property. They we living out of suitcases in a hotel while their home was staged and perfect for over 30 days. They were hoping for a quick sale of their property but also were not willing to leave any cash on the table - and I don't blame them. Your home is most peoples number one asset. Home prices have increased in Santa Cruz County from the median price of $882,000 in 2018 to over $1,200,000 in 2023. Thankfully I was able to give these folks some solid options to make a move and buy BEFORE they sold. This allowed them to enjoy their current property as long as possible, fund their next purchase, and not leave money on the table.

Here are three strategies to help you unlock your next chapter with ease and confidence.

Option 1: Bridge Loan

A bridge loan acts as the financial link between your current home and your new home, allowing you to move forward without waiting for your existing property to sell.

Pros:

• Quick closings: Get from contract to close in as little as 11 days, securing your dream home in a competitive market.

• Non-contingent offers: Skip the contingencies and compete like a cash buyer, leveraging the equity in your current property.

• Move once, stress less: Close on your new home first, giving you time to prepare your old property for top-dollar sale.

Cons:

• Higher rates: Bridge loans typically come with slightly higher interest rates and origination fees (around 2% of the loan amount). However, the benefits of stronger bargaining power and a quick close can make it well worth the cost.

Option 2: Trade-Up Mortgage – Unlock New Doors

A "purchase guarantee" or trade-up mortgage, offered by companies like Calque, allows you to secure a contract to sell your current home, giving you the freedom to make non-contingent offers on your next property.

Pros:

• Confidence to compete: Make offers without a contingency to sell your current home, often closing in just 15-21 days.

• Simplify your move: Use expected proceeds from your sale to secure your new loan without the stress of saving a second down payment or moving twice.

Cons:

• Timing risks: There’s always a small chance the sale of your current property could face delays. But with a guaranteed purchase price and a professional managing the process, you’re set up for success.

Option 3: Contingent Offer – A Traditional Safety Net

A contingent offer ties your purchase to the successful sale of your current home, providing peace of mind during your transition.

Pros:

• Financial security: Ensures you won’t be stuck owning two properties simultaneously.

• Cost-effective: Lower upfront costs compared to bridge loans or trade-up mortgages.

Cons:

• Competitive challenges: Sellers typically favor non-contingent offers, which can make it harder to win in a competitive market.

• 
  

Now that you know the options, let’s tailor a strategy to your unique situation. Whether it’s a Bridge Loan, leveraging a trade-up mortgage, or making a contingent offer, I’m here to guide you every step of the way.

Let’s make your next move as stress-free and seamless as possible.

Contact me today to get started!

Megan Kilmer

Realtor DRE 02095012 | Loan Officer NMLS 2436714

Cell: 831.888.7530 | Email: megan@revesthomes.com