Need to downsize but can't get mortgage.....should I look into a hard money loan?

[Anonymous]

Many buyers want to move right in in 30-45 days. Don’t assume the buyer will be OK with a rent back.

Consider renting until you find the house you want.

[Anonymous]

OP, unfortunately you have found yourself in a less than ideal situation (as many, including me, have found themselves in). I suggest you adjust your expectations a bit and accept that fact that the result may not be ideal for you. That is unfortunate, but under the circumstances, less than ideal may be the best of all possible worlds.

[Anonymous]

I would just do a closing of 45-60 days, then plan on a short term rental.

I would also adjust your housing budget down so you can breather easier. Figure out what you would net after paying taxes and commissions. You're not going to pocket the entire sales price. Good luck and take care.

[Anonymous]

avalonrose wrote:See above...I edited my post.
Yes, we own the home outright.
The upkeep on it is getting a little bit much, as it's a large house.
We need to buy a smaller one for about 850, and we intend on making a profit.
But we can't buy a home without selling ours first, because no lender will give us an 850k loan to purchase a new house before we sell the home we're in now due my husband's current income level.
So, I was asking if anyone had done a hard money loan, or some other kind of loan that is determined on the home's equity and not on income.

Sell your home and ask for a short rent back or sell it and look for a new home quickly with a short close. Personally with your situation I would not buy one for $850K. How will you pay taxes? Upkeep?

If you are having employment issues I would either rent a house after you sell or try and buy a home for $500K- $600K max or move to a LCOL area, buy a home for way less, and look for new jobs there. Invest/save the rest of the money, do not spend it on anything. You won't make $1.1 million. There are a lot of costs associated with selling a home, so if you must buy a home then you need to look for a cheaper home.

Or stay in a short term rental or short term hotel and put your stuff in storage.

[Anonymous]

Anonymous wrote:OP, here is a summary of your options that I can think of:
1) Hard money loan. It's an option but not a good one since there are origination fees and the interest rate is higher than what a bank would charge.
2) Bridge loan from a bank. This is better than a hard money loan. Less fees and lower interest rate. This is different than a mortgage which I think you were looking at.
3) Sell your house first and rent back. But since you do not know when you will find a house to buy, this is a risky strategy. Maybe do a 6 month rent back.
4) Put in offers with a "home sale contingency" which isn't great because a seller does not like to see contingencies.
5) Try to time the sale of your house and the purchase of your house on the same day. This is very difficult to do but is possible
6) Sell your place with a 60-90 day rent back and if you can't find a place to buy, do a long term AirBnb temporarily for a few months until you can find a house you like.
7) Apply for a HELOC or Home Equity Loan and then use that money to buy a house. You should be able to find a lender to get you 80% of the value of your house which it sounds like your budget is for your new house.

Hope this summary of options helps you!

No lender will approve a mortgage for a buyer where the seller has a six month rent back. You’re clueless.

[Anonymous]

This is silly OP stay.

There is zero reason for you to move to a $850,000 house from a $1.1 house.

You need to move to a $650,000 or less home for this to make any sense.

By the time you factor in move costs this is just wrong.

[Anonymous]

You can put your home on sale and look for a cheaper one and do contingent contracts, you'll get to align your sale and purchase.

You can also sell with condition to rent back for 3 months so you can buy nee one and move before handing over the house to your buyer.

[Anonymous]

or you can buy a rent to own house.

[avalonrose]

Anonymous wrote:OP, unfortunately you have found yourself in a less than ideal situation (as many, including me, have found themselves in). I suggest you adjust your expectations a bit and accept that fact that the result may not be ideal for you. That is unfortunate, but under the circumstances, less than ideal may be the best of all possible worlds.

You are probably right. We have such cold feet about listing it without knowing where we will go. I went to a few showings where the vibe was seriously off, and I'm afraid of buying someplace like that and having mental health problems because of it.

[avalonrose]

Anonymous wrote:This is silly OP stay.

There is zero reason for you to move to a $850,000 house from a $1.1 house.

You need to move to a $650,000 or less home for this to make any sense.

By the time you factor in move costs this is just wrong.

Where do you get your figures? Realtor fees will cost us about $60k and moving will be approximately $4k. Am i missing something? We still will have at least 150k in profit.

[Anonymous]

Anonymous wrote:This situation is why we tell people all the time on this site that paying off your house isn’t the amazing financial decision that a lot of people think it is.

You think they’d be in a better place if they owed money on the house? Ok….

[Anonymous]

You need sell, then put all your stuff in storage and rent a tiny place while you look for a new place.

[Anonymous]

avalonrose wrote:

Anonymous wrote:This is silly OP stay.

There is zero reason for you to move to a $850,000 house from a $1.1 house.

You need to move to a $650,000 or less home for this to make any sense.

By the time you factor in move costs this is just wrong.

Where do you get your figures? Realtor fees will cost us about $60k and moving will be approximately $4k. Am i missing something? We still will have at least 150k in profit.

Moving will cost you a lot more than 4000. When was the last time you moved? 2000?

Also, how about the cost of fixing up your place? Painting, carpets, cleaning? Fixing all the broken stuff?

You don't know what you're doing.

[avalonrose]

Anonymous wrote:

avalonrose wrote:

Anonymous wrote:This is silly OP stay.

There is zero reason for you to move to a $850,000 house from a $1.1 house.

You need to move to a $650,000 or less home for this to make any sense.

By the time you factor in move costs this is just wrong.

Where do you get your figures? Realtor fees will cost us about $60k and moving will be approximately $4k. Am i missing something? We still will have at least 150k in profit.

Moving will cost you a lot more than 4000. When was the last time you moved? 2000?

Also, how about the cost of fixing up your place? Painting, carpets, cleaning? Fixing all the broken stuff?

You don't know what you're doing.

We've already fixed the place up. It looks nice. All we have left to do is have carpet in bonus room steamed.....that's it.

[Anonymous]

How desirable is your house? Will it sell immediately and get lots of offers? Or not so much?