Moving On Up? 5 Things Move-Up Buyers Need to Know
Even though move-up buyers have been through a real estate transaction before doesn’t mean they know or remember the whole process. Plus, moving up can be very different than being a first-time homebuyer. Here are the 5 things move-up buyers need to know.
1. If you can, buy your new home first and then focus on selling your existing home. Selling one home while buying another simultaneously can be incredibly stressful. If you can afford to, find your new home first so you aren’t under pressure to move out of your existing home within a specific timeframe. If you need to leverage equity from your existing home to afford the down payment on your new home, talk to your lender about your options. You might be able to secure a home equity loan on your existing home to use as a down payment on your new home. Your lender might also have other solutions to help you leverage some of your equity ahead of selling your existing home.
2. If you’d have to add a contingency to an offer on your new home, don’t risk it. Sellers see a contingency like “buyer to sell existing home” on your offer letter and they’ll turn down the offer. No seller wants to be beholden for the sale of their home to the sale of someone else’s home.
3. Do your homework before you make any upgrades or renovations to your existing home. Have a trusted agent walk through your home with you to suggest changes and spend some quality time watching HGTV. A whole generation of buyers use HGTV as a measure of what is trendy and desirable in a home. You’ll be surprised how much you can learn about what buyers want from watching television.
4. Clean up your credit before you begin the process of qualifying for your new home. Just because you were approved for the loan on your existing home doesn’t mean you’ll be approved for a loan on your new home. The criteria for creditworthiness has changed over time, especially since the housing market crash in 2008. Get copies of your credit reports from all three credit bureaus (usually free once every 12 months) and take care of any inaccuracies and remedy any black marks.
5. Plan ahead–at least a year in advance. If possible, begin to plan your move-up about a year in advance. This will give you time to identify and address needed improvements for your existing home, clean up your credit and begin looking at potential new homes to get a sense of what you would like your new home to include. Visit open houses and explore homes that are similar to what you’re looking for. Bonus, this will also help you figure out if you *really* want to move after all.
Moving up from your existing home to a new home can be both exciting and stressful. Using these 5 tips for move-up buyers can help you get prepared and plan your move in a way that is less stressful and much more fun.