New mortgage or Home equity loan for move?
Question: We have a house here in Texas that we inherited and is worth >close to $100K. . . . So, the question is, how to finance a house in Maine before we >can sell the house here? We’ve seen several houses in the 50-85K range >on the Web that we like.
Answer: Donning asbestos suit first…. (others may have entirely different strategies).
You have great equity in the inherited house, enough to buy the Maine house. I’d use it. Get a home eq line of credit pre-approved for draw up to $X and then when you find the house in Maine, you can just write the check. You will have a very quick and easy closing. You may be able to get a better deal from a seller in a hurry because you don not have to wait for a mortgage approval on the new place.
You are trading down, so when you eventually sell the Texas house, just pay off the loan, taking (again) very little from the closing, and you will be all set. There will never be a loan against the Maine house.
Now, the complication… when you apply for the home eq loan…. it would be helpful if it was indeed your ‘home’; that is where you reside, at the time of the application. And on the loan app, can you honestly list a current Texas employment using that home address…. As for the intended future move, I personally would be willing to take a don’t ask/don’t tell policy with the lender, but would consider it fraud to falsify present employment to qualify.
If you can pass that hurdle, you’ll be golden.
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