Buying a Home when you have a Home to Sell in the Lehigh Valley

So, you already own a home in the Lehigh Valley but you wish to buy a new home (as your primary residence). What are your options if you have to sell Home 1 in order to purchase Home 2?

Ideally, you would list your current home, find a Lehigh Valley Home Buyer who makes an acceptable offer, then pursue making an offer on your next home. Your offer on the new home would be contingent on the settlement of your first home. This is known as a Home Settlement Contingency. If for some reason the buyer of your home doesn't work out you are not legally required to purchase the new home. When you have a home to sell, this gives you the most negotiation power.

Unfortunately, the above scenario causes a major concern. What happens if you Sell Your Lehigh Valley Home but you haven't found a home to purchase? This is the risk taken to give you the most negotation power on your new home. It can also leave you homeless.

Okay, what are the options if you don't want to do it this way.

Unfortunately, the other three options may cause you money and/or negotiation power.

Option 1) List your home but make any buyer aware that the sale of your home to them is contingent on you finding a new home. Typically, this means the buyer of your home will give you a month or two to find a home (negotiable). If you don't find it, the deal with the buyer is canceled. This is a risk to your buyer so as a result they may offer a lower price (to give you the needed time with no guarantees they will be buying the home).

Problems: Lehigh Valley Home Buyer negotiates lower price to give you the needed time to find a home. You probably can't pursue a Short Sale Property because of the unknown timeline of bank approval.

Option 2) Make an offer on the new home with a Sale and Settlement Contingency. This means that the seller of the home you wish to purchase will remove their home from the market and give you time to list your home as well as find a good qualified buyer. If your good buyer ends up not being able to close, you can cancel the contract with the seller of the home you are buying. This is a big negative to the home seller. They pull their home off the market and put the risk on you selling your home.

Problems: You probably can't purchase a Bank Owned (REO/Foreclosure) property. Banks don't want to see home sale contingencies of any type and definitely not one that requires you to list and sell your home. A higher price, to offset this negative, will probably not work with the bank like it might on a person selling their own home.

Option 3) I've seen some buyers search for homes, find one they like, then list their home. They don't put an offer on the home they like but hope that they will receive an offer on their home quickly so they can place an offer on the new home.

Problems: You might have to set the price on your home lower than you might have because you want to sell it fast in order to purchase the other home. While you are going through the process of listing and marketing your home, the other home might sell.

If you have any specific questions about the process, please contact me. In the meantime, please visit www.lehighvalleyhomesonline.com for all of your real estate information.