If you’re in the process of moving to a new home, but your current home hasn’t sold yet, it can be a stressful and frustrating experience. You may be worried about how you will manage to make the move while still carrying the burden of your previous home. In this article, we’ll provide you with some tips to help you move forward if your house hasn’t sold yet in Texas.
The first thing to consider is the type of mortgage you have on your current home. If you have an FHA, Fannie Mae, or Freddie Mac mortgage, these organizations have rules about obtaining a second mortgage while still owning your home. In most cases, you will need to have significant equity in your current home or demonstrate that you can afford both mortgage payments to qualify for a second mortgage.
If you don’t qualify for a second mortgage, there are other options available. You could consider renting out your current home to generate income and help cover your mortgage payments. This may also allow you to wait until the market improves before trying to sell your home.
Another option is to negotiate a rent-back agreement with the buyer of your current home. This is an agreement where you agree to rent your home back from the buyer for a specified period, which can give you extra time to find a new home.
You could also consider bridging finance, which is a short-term loan that can help you cover the cost of purchasing your new home while you’re waiting for your old home to sell. However, be aware that this type of financing can come with high interest rates and fees.
In any case, it’s important to have a solid plan in place before you make your move. You don’t want to find yourself in a situation where you’re struggling to cover two mortgages or can’t afford the payments on your new home. Take the time to research your options and consult with a financial advisor or real estate professional to determine the best course of action for your individual circumstances.
How to Move if Your House Hasn’t Sold Yet in Texas
First off, to qualify for a second mortgage through the FHA, you must meet certain qualifications.
You need to have a good reason for needing to move right away, and not after your current house has sold. For example, moving because your family needs a larger space, you are separating from your spouse or for work purposes.
Also, you cannot owe more than 75% of the value of the first home. There are additional restrictions as well, do your homework before assuming you will qualify for an additional loan through the FHA.
Asking family can be another route, so long as you put everything in writing.
Agree to pay them back in full upon the sale of your first house. Whenever you borrow money from family, you want clear terms to be set and adhered to.
If you think a family relationship could be damaged because of money, you might want to look for a different way to secure the financing you need.
A bridge loan or as it’s sometimes called, a “wrap” loan can help “bridge the gap while you attempt to cover two house payments.
These types of loans will take both mortgage payments, and combine them into one interest-only payment. These are typically short-term loans, lasting 6 months to one year.
Lenders have different requirements, but you must typically have great credit and be financing less than 80% of the value of both houses.
While it may not be your first choice, you can talk to your boss or plan administrator about borrowing from your 401k.
Make sure you understand how the tax penalties will work, and pay yourself back after the sale of the original home. This may not be an option for everyone, but definitely, something to look into.
Try to offer the seller of the second home, the option to rent it back from you for a few months.
Depending on their situation, they might love the idea of being able to stay in their home while they shop for a new one. If you are attempting to carry two mortgages, this is a great way to alleviate the cost.
Add in a contingency in your offer allowing you to close on the new home, only after your home has sold.
If your home is new to the market and priced well, it should sell right away. Present this to the owners of the second home, along with your offer. Ensure them that the closing won’t be delayed and that you agree to close in a certain amount of time