Selling home on a contingency to buy another

[Eric]

I've been out in the Central Valley for a few years and now that both my wife and I are retired we've decided to move back closer to the Bay Area, it offers better whether and easier drives in and out of the city for me.

In order to make all of this happen we have made an offer on a new build in the Bay Area and they've accepted it on the contingency that we sell our current home, so basically we put it on the market, hope it sells in a 30 day time period and then buy the new home. We've purchased homes before but never under these circumstances, wondering if anyone else has been through this.

Our realtor seems to think that even in this market our home will sell pretty quick so we're pretty optimistic.

 

[mollyc]

I have not done a transaction like that, but a new house sounds super fun! Good luck with it all.

 

[Citysnaps]

A different situation, but still relevant for a fast close.

We put our previous home up for sale on the market a year and a half ago, and needed a relatively fast and uncomplicated close so that we wouldn't lose the IRS deduction that's applied against capital gains for owning and occupying your home for at least two years (in the aggregate) out of the last five years.

Our agent was in tune with that and let other inquiring agents (with potential buyers) know before they wrote offers. We also had various inspection reports and disclosures already finished and ready to read by potential buyers.

Within a week we had around seven offers. The one we accepted had an offer over asking price, with the potential buyers already pre-qualified for the needed loan, a large non-refundable deposit, and acceptance of our inspection reports (and thus not needing to get their own). Escrow closed in 10 days. We were happy as were the buyers.

If you're looking for a fast close, some of the above might be useful for you and your agent to consider.

Good luck!

 

[Eric]

A different situation, but still relevant for a fast close.

We put our previous home up for sale on the market a year and a half ago, and needed a relatively fast and uncomplicated close so that we wouldn't lose the IRS deduction that's applied against capital gains for owning and occupying your home for at least two years (in the aggregate) out of the last five years.

Our agent was in tune with that and let other inquiring agents (with potential buyers) know before they wrote offers. We also had various inspection reports and disclosures already finished and ready to read by potential buyers.

Within a week we had around seven offers. The one we accepted had an offer over asking price, with the potential buyers already pre-qualified for the needed loan, a large non-refundable deposit, and acceptance of our inspection reports (and thus not needing to get their own. Escrow closed in 10 days. We were happy as were the buyers.

If you're looking for a fast close, some of the above might be useful for you and your agent to consider.

Good luck!

Appreciate the insight, a year and a half ago the market was so much hotter and it's great that you had 7 offers, wow! So yeah, before we pulled the plug I was adamant that nothing starts until we get pre-approval for the purchase price of the new home, which we finally got the other day. After all, without that there is no point. It's great that the seller is offering a contingency, even a year ago they were all refusing because sales were so high for them and it's a headache they don't want for understandable reasons.

Our real estate agent is confident it will sell pretty quick but we'll believe it when we see it just to be on the safe side . She sold our last home and did an excellent job though. We have stagers coming in tomorrow and are getting all the crap out into the garage, but I'm on a union break right now.

I'm also playing project manager (almost feels like I'm back at work) and coordinating all the various parties involved to keep them in the loop and synced up, I've even created a project task list with roles and responsibilities and the whole thing. Moving is always fun, the next month will be intense lol.

 

[Herdfan]

I've been out in the Central Valley for a few years and now that both my wife and I are retired we've decided to move back closer to the Bay Area, it offers better whether and easier drives in and out of the city for me.

In order to make all of this happen we have made an offer on a new build in the Bay Area and they've accepted it on the contingency that we sell our current home, so basically we put it on the market, hope it sells in a 30 day time period and then buy the new home. We've purchased homes before but never under these circumstances, wondering if anyone else has been through this.

Our realtor seems to think that even in this market our home will sell pretty quick so we're pretty optimistic.

Most nerve racking thing I ever did.

When we were getting married, I owned a house, but it was a single guy house. Just a little 2/2 in town built in the 50's. Like I said, I was single so I didn't do much to it other than build a nice deck.

I put it on the market and once I had a contract, we went house hunting. Found one we liked and put in an offer with a contingency. It was accepted. The sale of my house then fell through, but we really wanted the house and the contingency gave me 60 days to close or lose the house and earnest money.

Finally got another offer and it went through, but man those were a few sleepless weeks.

When we bought the current house, I just went to a mortgage broker and got a No-Doc, 10% down at like 8%. Once our old one sold, we refinanced with a more traditional mortgage. But the days of true no-docs are over because people abused them.

So, how are you going to have a mortgage and if so, how do you feel about paying more so those with worse credit can pay less?

 

[Eric]

Most nerve racking thing I ever did.

When we were getting married, I owned a house, but it was a single guy house. Just a little 2/2 in town built in the 50's. Like I said, I was single so I didn't do much to it other than build a nice deck.

I put it on the market and once I had a contract, we went house hunting. Found one we liked and put in an offer with a contingency. It was accepted. The sale of my house then fell through, but we really wanted the house and the contingency gave me 60 days to close or lose the house and earnest money.

Finally got another offer and it went through, but man those were a few sleepless weeks.

When we bought the current house, I just went to a mortgage broker and got a No-Doc, 10% down at like 8%. Once our old one sold, we refinanced with a more traditional mortgage. But the days of true no-docs are over because people abused them.

So, how are you going to have a mortgage and if so, how do you feel about paying more so those with worse credit can pay less?

I see it as a tradeoff, there are times we benefit of the backs of those who had to pay more, so when it's our turn we'll pay a little more I don't mind so much. But keeping the politics out of it, I think we'll lock in at just over 5% and then in a couple of years when things stabilize again we'll re-finance.

I get what you're saying about selling the current home, especially one that was build so far back because of the appraisals and likely aging home. We're lucky in that our current home is still less than 4 years old and in excellent condition so the hope is we won't have to do too much but yeah we'll have to choose the right buyer (hopefully).

 

[Citysnaps]

I'm also playing project manager (almost feels like I'm back at work) and coordinating all the various parties involved to keep them in the loop and synced up, I've even created a project task list with roles and responsibilities and the whole thing.

Excellen! I think that's critical and helps ensure a timely sale and close.