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Tell me about selling current home/buying new one.

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Tell me about selling current home/buying new one.

Old 11-08-05, 04:42 PM
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Tell me about selling current home/buying new one.

I知 a first-time homeowner. We致e lived in the house almost 2 years, but now are moving (about 45 miles away) because I知 starting a new job. We purchased our home through a mortgage company (First Horizon). I start the job in about 3 weeks. My question is, how does it work when you池e selling your current home, but are planning to buy a new home? When I sell my home, does the money go straight to the mortgage company? I知 assuming yes. So, in order for us to purchase a new home, do we need to go through the application process again with the mortgage company? I知 confused about how we need to coordinate the whole thing.
Old 11-08-05, 04:45 PM
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You have a couple of choices. The easiest is to make offers on other houses contingent upon your selling. That weakens your bargaining power. A better choice is to only look at other houses once yours has an offer, then make your offer contingent upon the close of your house. Also, you could do what is called a "bridge loan" if you have the income to support it.

Personally, I would put your house on the market, wait for an offer, then make a new offer. Commute until it is sold.
Old 11-08-05, 05:31 PM
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If it's "almost" two years... how close to two years? Real real significant tax breaks (regarding the gain on sale) are lost if you haven't had the house for at least two years...
Old 11-08-05, 05:40 PM
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Originally Posted by WildcatLH
If it's "almost" two years... how close to two years? Real real significant tax breaks (regarding the gain on sale) are lost if you haven't had the house for at least two years...
Not if he is taking it an putting it into another primary residence.
Old 11-08-05, 07:41 PM
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Originally Posted by Patrick G
I知 a first-time homeowner. We致e lived in the house almost 2 years, but now are moving (about 45 miles away) because I知 starting a new job. We purchased our home through a mortgage company (First Horizon). I start the job in about 3 weeks. My question is, how does it work when you池e selling your current home, but are planning to buy a new home? When I sell my home, does the money go straight to the mortgage company? I知 assuming yes. So, in order for us to purchase a new home, do we need to go through the application process again with the mortgage company? I知 confused about how we need to coordinate the whole thing.
You're making it more confusing than you have to.

You are selling your home. The attorney or title/escrow company will pay off your current mortgage with the proceeds of the sale. You get the remainder after paying any realtors/taxes/etc. If you are selling without an agent, it shoulkd be under 2% of the sale price. With an agent, you may need to add another 5% to that.

You are buying a new home. Since now you have money coming from the sale of your current home, you can make (hopefully) a downpayment. You are getting a new loan and everything, so, yes, you make a new application, etc.

HOWEVER...

Consider that you may be paying in excess of 10% of the total transaction costs to buy a new house. You may also have a mortgage with a higher rate (maybe).

Wouldn't commuting be cheaper? I know gas is costly now, but just keep all this in mind, especially if you think the new job might only be for two or three years.
Old 11-08-05, 07:55 PM
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Originally Posted by The Bus
You are selling your home. The attorney or title/escrow company will pay off your current mortgage with the proceeds of the sale. You get the remainder after paying any realtors/taxes/etc. If you are selling without an agent, it shoulkd be under 2% of the sale price. With an agent, you may need to add another 5% to that.
Keep in mind that those percentages vary greatly by region. Closing costs without a realtor around here will run closer to 3%, and with will add another 6-7%.

My guess is that places at 5% probably have average prices well over $200,000.
Old 11-08-05, 09:22 PM
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Thanks for the great advice, guys. So, would you guys sell yourself, or get a realtor?
Old 11-08-05, 09:28 PM
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Originally Posted by Patrick G
Thanks for the great advice, guys. So, would you guys sell yourself, or get a realtor?
Since it sounds like you're not terribly familiar with the process, I'd get a realtor.
Old 11-08-05, 09:34 PM
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Well, keep in mind you are talking to one. Depends on how much hassle you want. Maybe get a book about doing it yourself and just see if that appeals to you. If you do, at least pay a lawyer to take care of the paperwork.

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