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Gia, Home Seller in Cuyahoga Falls, OH

If you haven't sold your home yet is it possible to get approved for another home?

Asked by Gia, Cuyahoga Falls, OH Tue Mar 27, 2012

We found a house that we love but we are having a hard time selling and I'm afraid the house we love is going to sell before we can get it. Is there a possibility to get into a house before you sell yours?

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That's going to really depend on your financial situation. Do you have the funds to close on the new home or do you need the equity from the sale of your current home? Speak with your lender and ask them if you qualify. They'll look at your individual situation to help you determine if it's a possibility. Another thing to think about is can you afford a double mortgage payment...and for how long? You can also submit an offer contingent on your home selling.
1 vote Thank Flag Link Wed Mar 28, 2012
Hi Gia,

The answer to your question is dependent on whether or not your debt to income ratio qualifies with both the current mortgage payment and the mortgage payment on your new home.

A common question is whether you can rent out your current home and use the estimated rents received as income. In order to use expected rental income you need to have sufficient equity in your home (25% - 30%), at least a 12 month lease, proof of first month's rent payment, proof of secuirty deposit, and a savings account that contains 6 months worth of reserves.

The reserve savings requirement would be the amount AFTER the down payment on your new home. Let's say your current home payment (including taxes and insurance) is $1000 and the new home payment (including taxes and insurance) is $2000. Your total monthly housing expense is $3000. 6 months X $3000 = Savings of $18,000.
0 votes Thank Flag Link Wed Mar 28, 2012
This happens time and time again in a buyer’s market and unfortunately unless you’re able to carry both mortgages you will most likely be denied. The best bet is to speak to a lender and see if it’s even an option for you to carry both mortgages. You and your significant other should also discuss how it will affect your personal finances if you do get approved and also the possibility of your current home being on the market longer, causing you to sell at a deeper discount just to get out of the situation.
0 votes Thank Flag Link Wed Mar 28, 2012
Talk to some lenders and see if it's possible. If your credit is good enough and your debt to income ratio isn't to high you may be able to qualify for a loan to buy your new house before selling your current home.
0 votes Thank Flag Link Tue Mar 27, 2012
The best way to determine this is to contact a local lender. There are many factors that will determine whether or not you can qualfy for a mortgage before selling the home you are currently occupying.
Best of luck!
0 votes Thank Flag Link Tue Mar 27, 2012
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