DIYbanter - View Single Post - Short-term borrowing for down payment.

(Dipu) wrote in message . com...
HI

We have started the process of selling our current house and buying
another one. It is supposedly a sellers market in our area. We are
expecting to sell the house at some gain and use the gain as the
downpayment of the new house. Let us say we got a buyer and signed the
contract and they are beyond the contingency period. Lets say we have
1.5 more months to go before closing of escrow. Now if I want to buy
the new house and close on it before the older house escrow close, can
I borrow the down-payment against the money that I will receive from
the sale? Who would give such a short-term loan? My credit cards will
not cover the downpayment.

I know of other options to handle this situation like rent back etc. I
am interested on the borrowing of the down payment more as an
educational purpose.

Thanks.

You can. It's called a bridge loan. Generaly, these are pretty
expensive, and hte bank you get it from will probably want you to get
their loan which may not be the least expensive one available (they
have you over a barrell).

Don't use your credit cards. The lender will get a final credit check
ust before funding and having huge balances may impact your credit
score to the point of no loan.

Consider renting your sold house from the new owner for a month or
two. That is not atypical.

etter yet, just try to work with your buyer and get your seller (or
builder) to synchronize the closings better.