Monday, June 27, 2016

How to Buy & Sell a Home at the Same Time

Ah, to be a first-time home buyer again: How easy it was to buy a home when you weren’t carrying another mortgage on your back!

If you’re looking to graduate from first-timer to repeat buyer, you know things are about to get much trickier. Unless you’re a bona fide house collector, you’ll have to sell your home in order to buy anew—adding a whole separate layer of anxiety to what you already know is a stressful home-buying process.

In an ideal world, you’d buy a new home, move, and then, and when all the dust settles, deal with the turmoil of selling. But for most people, that’s totally unrealistic. Not only does it cost significantly more, since you’ll be paying two mortgages, but sellers might be quick to judge if you’re holding on to your current home.

If selling and buying simultaneously is the only way to go, here’s what you need to know to make sure both processes go as smoothly as possible.



Know the market first

Before you start seriously searching for a new home—or put your current home on the market—make sure you have a solid understanding of the housing market in your area (and the area where you’re planning to buy). Is the market weighted toward buyers or sellers?

Only then will you be able to fully strategize. As is so often the case, the best plan of action may differ depending on exactly who has the power.

That doesn’t mean to find one house you like and call it a day: Find multiple suitable options. That way, you’re less likely to find yourself in trouble if your purchase falls through—your newly sold home won’t leave you stranded.

Similarly, make sure to hire an appraiser and price your old home fairly. Now is decidedly not the time for delusions of grandeur: Two extra months on the market because you couldn’t humble yourself to lower the price means two months you’ll be paying double mortgages. Two very long months…

Plan your schedule carefully…

Should you buy first, then sell—or vice versa? Both have their risks and rewards. Selling first makes getting a mortgage easier, but it also means you’ll need to find a temporary place to live. Buying first means moving will be easier, but it also skews your debt-to-income ratio, making it harder to qualify for a new mortgage—not to mention the difficulty of juggling two monthly house payments.

Whichever option you choose, make sure you’re prepared to accept the consequences: having to store your stuff and rent temporarily, or undergoing the financial burdens of dual mortgages.

… but don’t rely on timing

When buying and selling a home simultaneously, there are numerous external circumstances that play a part.

Remember: You’re not the only party in this equation. For every seller there’s a buyer, for every buyer a seller. While things might appear to be working smoothly when viewing your master plan from above, that doesn’t take into account the variabilities of other people. Closings are rife with delays. Your buyers might have difficulty securing their mortgage; your home inspector may bring up issues that need to be fixed before you can move in.

So even if you’ve planned to sell your home first and are prepared to rent while buying, know that even the best-laid plans go awry—and you might end up juggling both mortgages. Preparing yourself for this (however remote) possibility ahead of time will ensure a smooth transition.

Know your financial solutions

For those who choose to sell first, the process is relatively straightforward other than the additional cost of a rental between homes. However, there is the option of a rent-back agreement, where you negotiate with the lenders and buyers to be able to remain in the property for a maximum of 60 to 90 days—often in exchange for a lower selling price or rent paid to the buyers. This can relieve some of the pressure of finding a new home, giving you additional time to house hunt.

But if you’re buying first, talk to your Realtor about ways to decrease your financial burden and risk. Here are the two most popular options for buyers:

Contract contingency: Buyers can request that their new home purchase be dependent on the successful sale of their old home. If you’re looking in a competitive market, this may not be a good option; however, if the seller of your intended home has had difficulty attracting interest, this may be a good deal for all parties involved—assuming you can convince them that your home will sell quickly.

Bridge loans: Bridge financing allows you to own two homes simultaneously if you don’t have deep pockets for a second down payment. This option is especially attractive if you’d planned to sell your home first and use the proceeds to buy the second. It functions as a short-term loan, intended to be repaid upon the sale of your original house.

Don’t let fear rush you

If your home has sold but you haven’t found a new place to live, don’t let anxiety push you toward a bad decision. DiMauro usually recommends that his clients pre-emptively plan on a short-term rental “so they don’t feel stressed or pushed into something that they would not normally be interested in,” he says. “They shouldn’t make a purchase because they felt like they were pressured from the time constraints.”

Found the perfect home right on schedule? That’s great. But don’t feel like you have to compromise on things that are important to you just because you need to find a home. Conversely, don’t accept a bid that you feel is too low just because your finances are strained by two mortgages. If you have a temporary apartment set up, you’re less likely to compromise.

Certainly, selling and buying a house simultaneously will be stressful—but carefully considering and planning for the risks and hurdles can mitigate the stress.


If you have a need for a real estate professional, please contact me. I would also appreciate your vote of confidence by passing my name to anyone you may know who would benefit from my services.


408.687.2026 |  Julie@JulieWyss.comwww.JulieWyss.com

Wednesday, June 8, 2016

8 Things To Do When You Move Into Your New Home

1. Change the locks
Before moving even one tiny piece of furniture into your new home, change the locks—or at least have them rekeyed. It’s not that you don’t trust the sellers but there are numerous people who've had contact with those keys over the years, any of whom could have copied the keys for some unsavory purpose.


2. Change the alarm batteries
Making sure your fire and carbon monoxide detectors have fresh batteries may not seem like a pressing issue while you’re in the middle of a stressful move, but it’s the kind of thing that gets ignored and then forgotten. Better to deal with it now, when the home is empty and you can make a quick sweep of the house—without lugging a ladder around furniture.

3. Review your home inspector’s report
Inspection reports are often filed with the escrow papers—but don’t wait until something goes wrong to pull them out. A good home inspector will outline the most important issues in their report, so use their expertise as a guide for your first few days of ownership. If they’ve marked anything as particularly pressing that wasn't addressed by the sellers, make sure to handle it before moving in.

4. Find the circuit breaker and water shut off
If you were there during inspection, you should know where your junction box is, but if you don’t, finding it should be top on your list.  During a move, when you’re plugging all sorts of electrical doodads into the wall, you don’t want to be lost in the dark hunting for that elusive metal box. Its a wise idea to also find the water shut-off, too.

Then, get familiar: If the panel is not already well-marked, have your spouse or another family member stand in different parts of the house while you flip different switches, and make a note of which ones handle different rooms.

5. Deal with any water problems
Deal with water-related issues immediately called out in the inspection report. These tend to be troublesome because they’re so easily ignored.  A leaky toilet might seem minor, but the steady drip can damage internal structural components.

Check your roof, too: If the rubber vent boots on your roof are leaking, you might not know it for a while.

6. Caulk everything
This one isn’t mandatory, but caulking is a whole lot easier if you do it when the house is empty, letting you see all the nooks and crannies that might need a little sealing—and don’t forget the exterior. Caulking issues occur in just about every home and while they might seem minor, it doesn’t take long before cracking gives way to leaks and even more water issues.

7. Plan your emergency exits
Before you begin bringing in furniture, walk through every room and decide how you would escape in an emergency. This can help you spot problem areas or rooms that need some adjustments—say, removing bars or adding egress windows to a basement.

8. Clean your gutters
Don’t let the dullness of this 'out of sight' task push you to procrastination: If the previous homeowners didn’t clean the gutters, you need to do so ASAP.

If you have a need for a real estate professional, please contact me. I would also appreciate your vote of confidence by passing my name to anyone you may know who would benefit from my services.


408.687.2026 |  Julie@JulieWyss.comwww.JulieWyss.com