As a first step, you need to determine if you are selling your home before buying a new home, or if you buy your new home before selling your property.
To decide, take into account the state of the market. If there are more buyers than sellers, the selling times are short and everything goes very fast. If your home is well estimated, it’s a safe bet that he will find taker easily. With the Maryland Waterfront homes for sale this is important.
On the other hand, if the number of buyers is reduced, the selling time will stretch. You, yourself, will have time for reflection when you find a home that meets your needs, but you risk waiting for the future buyer longer.
Anyway, take stock of your financial situation. Owning two homes involves many costs. For example, you will have to pay back mortgage loans, local taxes (property tax, housing tax, etc.), condominium fees if your property is in a multi-family building, provide maintenance, take out insurance and that, for both homes. However, the longer the sales lead times, the more you may have to bear these costs over time.
If you are counting on the sale of your first home to buy the second property, you must take out a bridge loan, also known as a “resale purchase loan”. With this financing product, the bank grants you an advance based on an estimate of the proceeds from the sale of your property. For a maximum of two years, this loan can be expensive: when you pay your monthly payments, you do not pay capital and only pay interest. The borrowed capital is settled in one go, when the property is sold. To reduce the cost of this loan, it is therefore in your interest to sell your home as soon as possible, and for that to estimate it most accurately.
You are a tenant
You want to invest by buying a property?
First, turn to banks to determine a budget envelope. By knowing your borrowing capacity, you can better target the assets you can potentially buy.
Then, take stock of your life project. But know that on average, a first-time buyer occupies his home for 7 years before reselling to expand. Some young households do not hesitate to move away from their place of work to acquire a few extra square meters. Do not forget to take into account your travel budget to your place of work (car, public transport) in your financing plan.
Buying a property: two very different documents
If before signing the definitive act of purchase at the notary, sign a preliminary contract is not mandatory, in fact, the two parties realize almost always. The pre-contract can consist of a unilateral promise of sale, or a sales agreement.
The unilateral promise of sale commits the owner to sell his property at a price agreed in this act with the future buyer who does not make a final commitment. For the payment of a fixed compensation, he has the option of buying or giving up his acquisition within a certain period agreed between the parties and which must be specified.
The sales agreement includes two reciprocal commitments: the first, the seller to assign his property to the buyer for an agreed price, and the second buyer to acquire housing. The seller may require the payment of a deposit, the amount of which is agreed upon by the parties (between 5% and 10% of the selling price).