| If you're a homeowner who is buying your next | | | | cause. Treat this as if you were trying to sell the |
| home, a home sale contingency should be on the | | | | house to the person you're hoping to buy from; |
| list of things to add to the paperwork associated | | | | show them pictures and information about the |
| with buying a new home and selling your old one. | | | | house and how market trends are in your favor. |
| Not having a home sale contingency can damage | | | | Show proof that other homes in the neighborhood |
| your finances and even endanger your home | | | | have sold easily and for around the price you're |
| ownership. | | | | asking. If your house is in a good neighborhood or |
| Basically, a home sale contingency is an | | | | next to a top-rated school, let the sellers know. |
| agreement that no legal transfer of mortgage | | | | Since they're going through the home-selling |
| debt will be conducted while you are still trying to | | | | process themselves, they will likely appreciate |
| sell your old residence. It gives you time to obtain | | | | what you're telling them about the likelihood of |
| what you need to conclude your purchase of the | | | | your house being sold quickly. |
| new home. Most importantly, perhaps, it prevents | | | | You can modify the home sale contingency into a |
| you from having to shoulder two mortgages. | | | | delay of sale (promising that you will buy the |
| As advantageous as this can be for a home | | | | house even if you haven't sold your own) and |
| buyer, to the seller, it can be a black mark against | | | | obtain a bridge loan. A bridge loan is a loan that |
| you. The seller wants to sell their house; not wait | | | | you get to cover possible expenses (such as a |
| for you, the buyer to determine whether you can | | | | second mortgage) while you wait for your house |
| buy. They don't want to sign a contract that will | | | | to sell. The great thing about a loan like this is |
| allow you to slip out of the deal, penalty-free, | | | | that, while it can pay for your expenses, it also |
| while they miss out on other offers. Usually, they | | | | can help reassure a seller that you will end up |
| don't know anything about you, other than that | | | | buying the house, even if you don't sell your own |
| you're in the market for a house (providing you | | | | by the end of the date indicated in the home sale |
| sell your old one), so they have no way of | | | | contingency. If you don't need to use it, you |
| knowing whether you're serious or not about their | | | | promptly pay the loan back and move in to your |
| property. | | | | new home. |
| Sooo... is there a middle ground? | | | | Avoiding the whole home sale contingency by |
| A slow market can mean that sellers are more | | | | negotiating a long-term/flexible closing date that |
| open to an offer with a home sale contingency | | | | will allow you to house-hunt while still living in your |
| attached to it. Having a realtor who knows the | | | | old home is probably the better choice, if you can |
| market and the trends can be invaluable at this | | | | manage it. Get the advice of a real estate |
| point, since you will be in a better position to | | | | professional concerning the best way to market |
| bargain. | | | | your home while you hunt for your next |
| Showing the seller proof that your present | | | | property. |
| property is likely to sell soon might also help your | | | | |