I'm relocating to Fl. Need some advice. What do I do first. Buy the new
house first or sell the old one first. Can I use my unsold house as
collateral towards the new house. Am I going the wrong way about it?

relaxing wrote:
I'm relocating to Fl. Need some advice. What do I do first. Buy the new
house first or sell the old one first. Can I use my unsold house as
collateral towards the new house. Am I going the wrong way about it?


It mostly depends on your financial position, what is convenient for
you, and what you want to do. If you sell your existing home first,
which is the most common approach, then you will need a temporary place
to live. Sometimes you may want to do this anyway, in order to check
out the new area and decide on the right area/house, while renting.
On the other hand, it does require moving twice, perhaps putting part
of your stuff in storage, etc. Depends on how much you have.

Buying the new house first works if you are in the financial position
to be able to carry both properties until you can sell the old one.
Makes things more convenient, but potentially more expensive. You can
probably get a bridge loan to help carry it, but when you start to do
that, it can get risky, again depending on your overall financial
position.

"relaxing" writes:

I'm relocating to Fl. Need some advice. What do I do first. Buy the new
house first or sell the old one first. Can I use my unsold house as
collateral towards the new house. Am I going the wrong way about it?


Depends on your income and creditworthiness.

Also depends on how well you want the old home to show.

In general, you're far better off selling the first home and having it
shown furnished, only having one house payment, and not being under
duress to sell. It puts you in a much stronger position. After you
have that money, go buy your next home. Most relo packages (if you
have one) have an allowance for temporary living. If not, rent an
apartment for 6 months or something.

You can purchase in the new city if your debt to income ratio and
credit score make a lender comfortable enough. You coudl take out a
home equity line of credit against your old home to come up with down
payment funds for your new home. Then, when your old home sells,
the proceeds pay off that line of credit. You can structure the new
home loan to have a first mortgage of a size that has monthly payments
that fit your long-term budget, and in the mean time, you can be
bleeding each month, making payments out of the home equity line of
the old house if you need to. I did this for a few months in a move.
It was emotionally nerve racking mind you, but it all worked out
finally.

Basically, unless you have a very compelling reason to buy before you
sell, I'd advise against it. It's rather stressful and risky unless
your old home is sure to sell in a decent amount of time.

--
--
Todd H.
http://www.toddh.net/

"relaxing" wrote...
I'm relocating to Fl. Need some advice. What do I do first. Buy the new
house first or sell the old one first. Can I use my unsold house as
collateral towards the new house. Am I going the wrong way about it?

Do you have a mortgage on the old house? If so, a lender may balk at giving you
a mortgage on the new house, unless the old one is under contract or leased out.
I had that problem about 15 years ago.

We sold our house first and rented for six months. Sure glad we did
because the area we had decided to buy in, turned out not to be a place
we would have been happy. It was a good thing for us to just "live
there" a little while and look around. The housing market was about
like it is now when we got ready to put our house on the market and it
took longer to sell than we had anticipated. You don't say whether you
are moving because of your job or just retiring. Be sure to do a lot
of research before you decide on where to settle in FL if you are
retired and have a choice. There is a lot of like about living here
but it also carries some problems with it that I didn't anticipate when
deciding to move.

relaxing wrote:

I'm relocating to Fl. Need some advice. What do I do first. Buy the new
house first or sell the old one first. Can I use my unsold house as
collateral towards the new house. Am I going the wrong way about it?

Considering how dramatically the home sales market has slowed down
nationwide, I'd sell first. If you haven't got a mortgage on it, and
if you don't need the money to use as a down payment, that may not be
a concern for you. But a lot of people are finding themselves forced
to pay two mortgages or take out bridge loans because their first
homes just aren't selling.

By the way, real estate values in Florida are nosediving. You'd save
money in the long run if you found a place to rent and waited a year
or so before making an offer. By late next year you'll have seen a lot
of desperate sellers hit the market as their ARMs reset and they can
no longer make their mortgage payments. The desperate sellers will
forces prices even further downward. The wait will also give you an
opportunity to get an informed idea of what your property taxes and
**homeowners insurance** costs will be. Home insurance rates in
Florida are skyrocketing. Frankly, it's just not a good time to buy
there.

HellT