07/09/2021
Welcome to Real Estate Pro Tips.
The topic is how to buy your next home before you sell your current home.
You will learn about a home buying strategy using consumer bridge loan financing that provides a competitive edge in our fast pace real estate market.
Many homeowners who want to sell are stuck in a holding pattern because they have been told by their lender that they must sell their existing home first to qualify for a home loan.
Homeowners are choosing to stay in their homes believe they will not be able to compete with buyers who do not have a home sale contingency or have all cash to purchase a home.
Selling your home first without knowing where you are moving creates anxiety in the homebuying process, especially when the supply of homes for sale is limited.
In our competitive real estate market, any contingencies in your purchase offer signal risk to a Seller, especially if the contingency is related to the sale of your current home.
Most home sellers will not accept a purchase offer if there is a contingency for selling another property.
One primary reason is the home sale contingency will impact their ability to buy their next home with a chain of home sale contingencies linked to their purchase offer.
One option is to buy your next home before offering your current home for sale.
What are some of the benefits of buying first and then selling?
It strengthens your negotiation position in a competitive Seller’s Market to compete with cash buyers.
There is no contingency for the sale of your home. You know where you are moving and how soon you can take possession of the home.
You can time the sale of your current home to avoid the hassle and cost of making a double move into interim rental housing.
The bridge loan solution enables homeowners to buy their next home before offering their current home for sale.
Compass provides access to a Bridge Loan Advance for up to 6 months of mortgage payments for the bridge loan.
When you find the right home, use your approved bridge loan to bid on a new home without a contingency to sell your current home.
Once you move into your new home, your Compass agent helps you to sell your current home.
When your former home sells, use the proceeds to pay back the Bridge Loan, the Bridge Loan Payment Advance and Concierge improvement loan.
Who is eligible for the Bridge Loan Advance Program?
The Bridge Loan Advance program is available exclusively for qualified clients with a consumer bridge loan who are working with a Compass Realtor to sell their existing home.
What if a home requires renovations or other work before offering it for sale?
Compass provides access for our clients to a home improvement loan to sell your home faster and for more money.
If you are approved for the Concierge home improvement loan, it has a zero percent APR for the life of the loan and there no additional loan or closing fees.
A bridge loan can help you sell your former home faster because you have moved into your new home while repairs and improvements are being completed.
When your former home sells, use the proceeds to pay back the Concierge improvement loan.
Other things you will learn:
• Other ways a consumer bridge loan can be used to help purchase a primary residence
• Rates and fees accompany a bridge loan
• What borrowers consider when exploring bridge loan financing
Pete Sabine and Leslie Whitney are Realtors with Compass in the San Francisco Bay Area. Mark Hanf is the broker and president of Pacific Private Money, one of the fastest-growing private lenders in Northern California. Pacific Private Money is different from conventional lenders.
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