Homeless People

Is The Prospect Of Being Homeless Stopping You Selling Your San Francisco East Bay Home?

Homeless PeopleIt’s no secret that there has been a real shortage of homes for sale in The Bay Area since the beginning of the year, and as the majority of people who sell their home are also buying in the same area, this creates a whole new set of potential pitfalls for homeowners.

Should You Buy First or Sell First?

This is an age-old question that homeowners have asked  whenever they are planning a move. The best answer will depend very much on your personal circumstances.

If you have lived in your home for 20 years or more and you have not had an equity line or a cash-out refinance, you probably have a pretty low mortgage payment and a substantial amount of equity in your home. This is perhaps the ideal situation, as you may be able to use some of that equity to provide a down payment on another home and still afford to make the loan payments on both homes for a month or two, until you sell the existing home. This way there is the least disruption to your life and a relatively low stress factor, plus given the fact that we are experiencing strong buyer demand for homes, provided you price your home appropriately, you should sell it quickly.

Of course you may not need to take the equity out of your existing home for a down payment. You may have sufficient savings or a 401K you can borrow against. That could be an even better option for you.

What If You Don’t Have A Lot Of Equity Now?

There are still some other approaches you may want to consider in order to make sure that you are not left with nowhere to live when your present home sells.

One increasingly common approach that sellers are using is to require that the buyer of their home allows for a rent-back in the purchase contract. If this is coupled with a 40-60 day escrow period, that could give you up to 3 months to find another home and close on it, and as all the signs suggest that more inventory is coming on the market, that could be more than enough time.

You may also consider making the acceptance of a sale on your existing home contingent on you finding and getting an offer accepted on a home you want to buy within 14 days. This is another method to give you some breathing space and buyers in general don’t seem to have much problem with that. Or you could consider the option of intentionally being homeless for a while. Maybe you want to sell your home for top dollar, which is easier to do right now, with such low inventory. If your personal circumstances permit, you could take on a temporary rental for a few months, waiting until inventory is really pickling up, then plan to buy when there is less competition.

Whatever approach is right for you, there is usually a way to achieve your objectives. Sometimes it takes a little creativity and sometimes you just need to come at the problem from another angle. Regardless, if you are wondering how to deal with a situation like this, I would suggest an informal meeting with a professional loan specialist who will outline the options that are available to you. I would be happy to provide you with a referral on request.

If you would like to have an assessment of the market value of your home or if you have any questions or comments, please do not hesitate to contact me on (925) 997-1585 or email bernard@bernardgibbons.com. There is never any obligation and I am always happy to hear from you.


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