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

[Anonymous]

I’m a hard money lender. You cannot get a hard money loan because the new property will be your principal residence.

You need to sell your old home first in this case.

[Anonymous]

OP, this slow rolling of pertinent info and refusal to listen to the pitfalls of your plan are really annoying. You indicated that your problem is that you want to free up cash for living expenses and you also don't like your current home. Posters are trying to help you solve your stated problems.

You also have a misconception that buying an $850K house is going to solve your problems. It won't give you the "few hundred thousand dollars" that you're hoping to net once you pay taxes, realtor commissions, and moving costs.

Plus you'll have to put some amount of money into any new home for storage, some new furnishings because the old ones don't work, window treatments, etc.

A hard money loan is a bad idea for the reasons stated by others.

So how do people sell then buy when they don't have the finances to buy before selling (which is a big part of your stated problem)? They either have a long closing and buy what's available during that time, do a rent back (harder to get with the current market) to give an extra month or two to buy a house, or they sell then do a short term rental to allow more time to look for a house.

You should look at $650K-700K homes in your target area and see if any of them could work for you. If homes in that price range could work, then put your home on the market and either request a long closing or do a short-term rental.

You're lucky with the timing. Your kids could finish the current year at their school, then you could rent a place for a month or two while you house hunt. Then you move into the new house before school starts.

[Anonymous]

My house owner wanted a two month free rent back. I wanted house so aggrieved. Just do that.

they were downsizing. They only started house hunting after I had a signed contract with them

[Anonymous]

OP, I would be more concerned with husband's (and your) job situation and whether it will remain the same going forward. Your whole financial picture needs to be looked at. How hard will it be for you and/or your husband to get better employment/stable employment so that you don't have to go through this again? You could be in the same situation in a couple of years and be downsizing again if you don't solve that issue first.

[Anonymous]

If you sell 1.1 million and buy 850K there most likely will be no profit.

Real Estate commission is like $50,000, closing costs another 10K. Getting house ready to sell and doing repairs etc as result of inspection another 20K.

Then 10K for moving costs, now you have closing costs new house maybe 10K to 20k and your own repairs and such to house like painting, small stuff of maybe another 10K.

You be lucky to walk away with 40K. Just get a job. Even if you and your husband got average jobs you quickly make 40K. You could get $25 an hour being an overnight nanny or caretaker on Care .com My daughter briefly did it part time for a person on weekends. it is a 12 hour shift, she could nap on couch while they were asleep and got dinner and breakfast. She made it for them. Was getting $600 a week just from that. Imagine you did that five days a week.

Also in sales GM Cadillac and GMC bought pay car salesmen 100K a year. That is a good job if you are good at sales. And with benefits.