Need advice please…
Question: I have a contingency contract on a spec home that is being built with an expected close by the end of November. The contingency runs through the end of October.
My current home has been on the market for roughly a month and we are getting close to the drop dead date on our contingency. At that time we must tell the builder either YES we are definatley purchasing the home or NO we are not. As with most people we need the equity out of our existing home as a down payment on the new home.
I told myself all along that if it came to this I would not close on the new home without selling the old home first but now I am wavering because we both realy love the new home. Can anyone offer me any advice on what I can do in this situation or what they have done. Bridge loans are a no in Texas and I’m a little quesy about equity loans. HELP!!
Answer: ted why not offer your home for sell using owner financing then cash out the note at closing minus a small discount. im a buyer of owner financed notes. if the property is financed per my criteria i will buy the note. I agree with the other person that answered. Sell your house first. they can build you anohter house in the near future. But, if you buy the new house, and then the old one does not sell, you might put a squeeze on yourself that could be VERy bad for you. the stress is bad for your health, the finances could strap you for a few years, and I’ve known one person taht lost BOTh houses doing that.
as for the person that buys notes? They noramlly offer about a 15% discount on a note, and if yours is not seasoned, it might be higher. Ask what they pay for an 8% loan (higher than the going rate on house mortgages right now, so about all you would get from a normal buyer. If they hvae bad credit, you’d get more, but the note buyer would pay less) that is 30 years long, and unseasoned. NOt a good option. Define “small discount” What do you pay for a $60,000 loan that is at 8%, on a house, for an average buyer, that is unseasoned? YOu pay $59,000? $59,500? A small discount? Or, you pay $47,000? Give me a quote on that type loan.
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